On 30 April 20X2, Neuman Ltd. sells a product to a customer for $504,000. The product carries a one-year assurance warranty. Neuman management estimates that the probable cost of fulfilling the warranty will be $42,000. Between 1 May and 31 December 20X2, the actual warranty cost was $16,800. On 31 December 20X2, management decides that the probable additional warranty cost will be no more than $11,000. Between 1 January and 30 April 20X3, the additional cost was $9,400. Required: 1. Prepare the entries concerning the sale and the warranty for 30 April 20X2 through 30 April 20X3. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

• Record the sales (Assume credit sales). (April 30 2012)
• Record the set up estimated warranty provision. (April 30 2012)
• Record the costs incurred. (Dec 31 2012)
• Record the reduce warranty provision to new estimate. (Dec 31 2012)
• Record the costs incurred.(April 30 2013)
• Record the unused warranty provision (April 30 2013)

2. Assume instead that the warranty now includes service and is sold separately with a stand-alone value of $64,000. The product has a stand-alone value of $495,000 and the total contract is $504,000. Prepare the relevant journal entries for 30 April 20X2 through 30 April 20X3. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round intermediate calculations to one decimal place.)

• Record the sale, with deferral for warranty (Assume credit sales). (April 30 2012)
• Record the costs incurred. (Dec 31 2012)
• Record the amortization of deferred revenue. (Dec 31 2012)
• Record the amortization of deferred revenue. (April 30 2013)
• Record the amortization of deferred revenue. (April 30 2013)