North Boulder USA, a tire manufacturer, guarantees its tires against defects for five years or 60,000 miles, whichever comes first. Suppose North Boulder USA can expect warranty costs during the five-year period to add up to 3% of sales. Assume that a North Boulder USA dealer in Denver, Colorado, made sales of $641,000 during 2018. North Boulder USA received cash for 15% of the sales and took notes receivable for the remainder. Payments to satisfy customer warranty claims totaled $18,500 during 2018.

2. Post to the Accrued Warranty Payable T-account. The beginning balance was $14,000. At the end of 2018, how much in accrued warranty payable does North Boulder USA owe to its customers? Select the appropriate descriptions, and enter the beginning balance and post the entries to the Accrued Warranty Payable T-account. Calculate the balance of the liability account. Accrued Warranty Payable