Determining the effects of various liabilities on financial statements.

Problem 10-5A Determining the effects of various liabilities on financial statements LO1, 4 Part 1: Okanagan Refrigeration manufactures and markets commercial refrigeration systems for food trucks and specialized transport trucks. It was disclosed in notes to the company's financial statements that estimated warranty costs are accrued at the time products are sold. Assume that in 2020 warranty costs are estimated at $315,000 and that the related warranty work was actually paid for during 2021.Required: Prepare journal entry to show the effect on financial statements due to warranties in 2020 and 20 View transaction list Journal entry worksheet 2 Record the effect on financial statements due to warranties in 2020. Note: Enter debits before credits. Date General Journal Debit Credit December 31, 2020 Record entry Clear entry View general journalView transaction list Journal entry worksheet 2 Record the effect on financial statements due to warranties in 2021. Note: Enter debits before credits. Date General Journal Debit Credit December 31, 2021 Record entry Clear entry View general journalPart 2: Assume that Fabfit Enterprises collected $1,950,000 during 2020 for fitness magazines that will be delivered in future years. During 2021, Fabfit delivered magazines based on these subscriptions amounting to $1,835,000. Required: Prepare journal entry to show the effect on financial statements in 2020 and 2021 by these subscriptions. View transaction list Journal entry worksheet 2 > Record the effect on financial statements in 2020 by these subscriptions. Note: Enter debits before credits. Date General Journal Debit Credit December 31, 2020 Record entry Clear entry View general journalPart 2: Assume that Fabfit Enterprises collected $1,950,000 during 2020 for fitness magazines that will be delivered in future years. During 2021, Fabfit delivered magazines based on these subscriptions amounting to $1,835,000. Required: Prepare journal entry to show the effect on financial statements in 2020 and 2021 by these subscriptions. View transaction list Journal entry worksheet Record the effect on financial statements in 2021 by these subscriptions. Note: Enter debits before credits. Date General Journal Debit Credit December 31, 2021 Record entry Clear entry View general journal