Estimated Warranty Liability

Yummy Co. sold $788,000 of equipment during January under a six-month warranty. The cost to repair defects under the warranty is estimated at 4% of the sales price. On August 15, a customer required a $217 part replacement, plus $242 of labor under the warranty.

Required:

(a)Provide the journal entry for the estimated warranty expense on January 31 for January sales.

Jan. 31 -

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(b)Provide the journal entry for the August 15 warranty work. If an amount box does not require an entry, leave it blank.

Aug. 15 -

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