More Info - X an ber w d by i December 1 5 5 own quire art ale 20 Ritchie sold 20 go-karts on account. The selling price of each go-kart was $1,200; the cost of goods sold for each was $750. Ritchie received notice of a class-action lawsuit being filed against it. The lawsuit claims that Ritchie's go-karts have engine defects that appear after the warranty period expires. The plaintiffs want Ritchie to replace the defective engines and pay damages for the owners' loss of use. The cost of replacing the engines would be approximately $375,000 (not including any damages). Ritchie's attorney believes that it is reasonably possible that Ritchie will lose the case, but the attorney cannot provide a dollar estimate of the potential loss amount. Ritchie performed repairs due to product warranty complaints for two go-karts sold earlier in the year. Ritchie's cost of the repairs, paid in cash, was $650. An individual claims that he suffered emotional distress from a high-speed ride on a Ritchie Go-Kart and is seeking $480,000 in damages. Ritchie's attorney believes the case is frivolous because it does not have any legal merit. Another customer is suing Ritchie for $150,000 because a defect in the customer's Ritchie Go-Kart engine started a fire and destroyed the customer's garage. Ritchie's attorney believes the customer will probably win the case and receive $150,000. (Use the following account names: Loss from Lawsuit and Accrued Liability from Lawsuit.) Ritchie estimates that the warranty expense is 5% of gross sales. Ritchie's gross sales for the period totaled $730,000 22 27 31 Print Done tit. The lawsuit claims that Ritchie's go-karts have engine defects that appear after the warranty period expires. The plaintiffs Requirement 1. Prepare the journal entries to record the transactions shown. Omit explanations. (Record debits first, then credits. Explan first cell in the "Accounts" column and leave all other cells blank.) Dec 1: Ritchie sold 20 go-karts on account. The selling price of each go-kart was $1.200, the cost of goods sold for each was $750. Do not record the cost related to the sale. We will do this in the next journal entry Journal Entry Accounts Date Debit Credit Dec 1 Now record the cost related to the sale above. Journal Entry Accounts Date Debit Credit Dec 1 Dec 5: Ritchie received notice of a class-action lawsuit being filed against it. The lawsuit claims that Ritchie's go-karts have engine defects damages for the owners' loss of use. The cost of replacing the engines would be approximately $375,000 (not including any damages). Rite Choose from any list or enter any number in the input fields and then continue to the next question. Type here to search o Dec solche received notice of a class-action lawsuit being led against The walcami che's go-kars are engine detects that appear after the warranty period expires. The plans wart Ritchie to replace the defective engines and pay damages for the sunroof use. The cost of placing the engines would be array $375,000 in coding any damage Richomey believe that is reasonably possible that the wise the case, but the attorney cannot provide amate of the potential loss amount Journal Entry Date Accounts Det Credit Dec 5 Dec 20 Riche performed repairs de to product warranty complaints for wo gokarts soldater in the year the cost of the repairs and in cash, was 5050 Jour Entry Accounts Debut Credit Dee Dec 22 individualcamat he stored emotional distress from aceed ride on a Go Kart and is on 100.000 in damage this tomay be the case is holous because it does not have any legalment Journal Entry Date Accounts Debut Credit Choose from store any number in the input fields and then continue to the next Gestion Type here to search 0 533 9 Fiche Go Kartssels motorized gokarts. Richie Go Karts are motorized and we typically purchased by sont parks and other recreation fout we also stay purchased by individuais for their own personal use. The company perpetual verlorystomSelected ansactions in the month of December ofw che lontoow the transactions Read the requirements Dec 22 And that he suffered notional tross fomed in a chi Go-Kartanding $180.000 in damages Roche's attomey be the causis volous because does not have any legalment Journal Entry Accounts Deba Credit De 22 Dec 27 Andruomessuing Richie for 150.000 bottoriche Go Kart engine dave and destroyed the customer's garage. Pochoy believes the customer will probably win the case and receive $150.000. Use the following our Loss from Laws and Androm Law Journal Entry Date Accounts Deb Credit Doc 27 Dec 31 Rhe time the warranty expenses 5% of gross sales for the period 730,000 Date Journal Entry Accounts Debit Credit Dec 31 Choose from any lot of for any number in the routes and the continue to the next question Type here to search E SPM Read the requirements Dec 31: Ritchie estimates that the warranty expense is 5% of gross sales. Fichie's gross sales for the period od 8730.000 Journal Entry Date Accounts Debit Credit Dec 31 Requirement 2. Describe how each of the contingentabiles in the selected December transactions would be treated in Rich's facilements for 2019. (Select four answers.) A Dec 22 transaction will not be fooled because is to be a loss OB. Dec 22 transaction will be footnoted as a contingent liability C. Dec 5 transaction will be reported as a fability on the balance short and an expense on the income statement Transaction will also be fooled 10. Dec 27 transaction will be reported as a ability on the balance sheet and a low on the income statement Transaction will also be footnoted, 1. Dec 5 transaction will be footnoted as a contingent ability DR Dec 31 transaction will be reported as a family on the balance sheet and an exporte on the home statement. Transaction will not be footnoted since it is recorded on the financial stator G. Dec 31 transaction will be reported as a bability on the balance sheet and an expense on the income statement Transaction will also be forced OM Dec 27 transaction will be reported as a fability on the balance sheet and an expense on the income statement Transaction will not be footnoted since it is recorded on the financial statem Choose from any list or enter any number in the host fields and then continue to the next question Type here to search 1 H