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Gateway LLC sold 150 color laser copiers in 2015 for $4,000 apiece, together with a one-year warranty. Maintenance on each copier during the warranty period
Gateway LLC sold 150 color laser copiers in 2015 for $4,000 apiece, together with a one-year warranty. Maintenance on each copier during the warranty period
averages $300.(Must attempt both sections for full quality points).
Instructions:
(a)Prepare entries to record the sale of the copiers and the related warranty costs, assuming that the accrual method is used. Actual warranty costs incurred in 2015 were $17,000.
(b)On the basis of the data above, prepare the appropriate entries, assuming that the cash-basis method is used.
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