Larkspur Inc. sells portable computer equipment with a two-year warranty contract that requires the corporation to replace defective parts and provide the necessary repair labour. During 2020, the corporation sells for cash 382 computers at a unit price of $2,370. Ignore any cost of goods sold. Based on experience, the two-year warranty costs are estimated to be $150 for parts and $196 for labour per unit. (For simplicity, assume that all sales occurred on December 31, 2020.) The warranty is not sold separately from the equipment, and no portion of the sales price is allocated to warranty sales. Larkspur follows ASPE.

Record the 2020 journal entry, assuming the cash basis is used to account for the warranties. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit eTextbook and Media List of Accounts

Record the 2020 journal entries, assuming the accrual basis assurance-type approach is used to account for the warranties. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit (To record sales) (To accrue outstanding warranty) eTextbook and Media List of Accounts

What liability relative to these transactions would appear on the December 31, 2020 balance sheet? How would it be classified if the accrual basis assurance-type approach is used? Larkspur Inc. Balance Sheet (Partial) $ $ eTextbook and Media List of Accounts

Assume that in 2021 the actual warranty costs incurred by Larkspur were $23,211 for parts and $36,403 for labour. Record the necessary entry in 2021, applying the cash basis. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit eTextbook and Media List of Accounts

Assume that in 2021 the actual warranty costs incurred by Larkspur were $23,211 for parts and $36,403 for labour. Record the necessary entries in 2021, applying the accrual basis assurance-type approach. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)