In 2025, Sandhill Co. introduced a new product carrying a two-year warranty against defects. The estimated warranty costs related to dollar sales are 2% within 12 months following the sale and 5% in the second 12 months following the sale. Sales and actual warranty expenditures for the years ended December 31, 2025 and 2026 are as follows: 2025 2026 O $0. Sales $809000 $35900. $34660. O $79590. 1008000 $1817000 Actual Warranty Expenditures $11700 35900 At December 31, 2026, (assuming the accrual method) Sandhill should report an estimated warranty liability of $47600

In 2025 , Sandhill Co. introduced a new product carrying a two-year warranty against defects. The estimated warranty costs related to dollar sales are 2% within 12 months following the sale and 5% in the second 12 months following the sale. Sales and actual warranty expenditures for the years ended December 31,2025 and 2026 are as follows: At December 31, 2026, (assuming the accrual method) Sandhill should report an estimated warranty liability of $0. $35900. $34660. $79590