Question
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?
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