For Question 8c, is $23500 = warranty claim in the current year?

8. (PSA9.8) At the beginning of 2014, Lincoln Plumbing Pty Ltd had a credit balance of $10 000 in its Warranty (Provision account? The ovarranty expense for the year was $14 000 and the balance of the Warranty Provision account at the end of the year after adjusting entries was $13 000 Required: (a) Calculate the cost of warranty claims during the period. Hint: It may be helpful to reconstruct the Warranty Provision account. (b) Prepare journal entries to record the warranty claims during the period and end-of-period adjustments to the Warranty Provision account. Assume that all warranty costs were for the replacement of parts from spare parts inventory. (e) Reconsider the situation of Lincoln Plumbing. Beginning balance of the Warranty Provision was $10 000, warranty expense was $14 000. If the balance of the Warranty Provision account at the end of the year was $500, re-calculate the warranty claims during the period. In light of these new figures, comment on the appropriateness of the provision. Do you think that the warranty provision is adequate? Give reasons for your answer. we 141 9. (E9.10) CB 2Fk th why underestimation cole of claims in the precious E WC $28500 , OB JOO WE yr