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Over the past four years, Stark Industries reported sales revenue and warranty expense as follows. 2017 2018 2019 2020 Sales revenue $8,000,000 $8,300,000 $8,600,000 $9,000,000

Over the past four years, Stark Industries reported sales revenue and warranty expense as follows.

2017

2018

2019

2020

Sales revenue

$8,000,000

$8,300,000

$8,600,000

$9,000,000

Warranty expense

240,000

260,000

245,000

290,000

You wish to recast the income statement to reflect a stable proportion of warranty expense to sales over the four-year period. What is the warranty expense adjustment for each year?

Question 10 options:

A)

For 2017, 2018, 2019, and 2020 respectively, $4,240; $6,601; $17,558; and $15,230

B)

For 2017, 2018, 2019, and 2020 respectively, $3,690; $4,107; $13,927; and $12,252

C)

For 2017, 2018, 2019, and 2020 respectively, $6,150; $4,401; $12,956; and $16,870

D)

For 2017, 2018, 2019, and 2020 respectively, $4,430; $5,309; $13,841; and $17,320

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