gnment Problem 13-14 Sheridan Company must make computations and adjusting entries for the following independent situations at December 31 , 2018. amolfiers carries a 3-year warranty against defects. On the basis of past experience the estimated warranty costs relat to lr sesare nd third year after sale-5% of sales revenue. Sales and actual warranty e the estimated warranty costs related to dolar sales are first year 2% of sales revenue, second year aftersale-3% of sales revenue; a - expenditures for the first 3 years of business were: Sales Revenue Warranty itures 2016 2017 2018 $ 873,300 1,005,600 1,319,200 $6,480 18,280 66,120 Compute the amount that Sheridan should report as a liability in its December 31, 2018, balance sheet. Assume that all sales are made evenly throughout each year with warranty expenses also evenly spaced relative to the rates above. Liability should be reported on December 31, 2018 s 2. With some of its products, Sheridan includes coupons that are experience, 40% of them are redeemed. The lab ity issued, and merchandise worth $8,350 was distributed in exchange for coupons redeemed for unredeemed coupons at December 31, 2017, was $9,550. During 2018, coupons worth $32,920 were Compute the amount of the liability that should appear on the December 31, 2018, balance sheet ed on December 31, 2018 Liability should be