Part $1$

Catskills guarantees its snowmobiles for three years. Company experience indicates that warranty costs will be approximately $5\%$ of sales. Assume that the Catskills dealer in Colorado Springs made sales totaling $ $550,000$ during $2024.$ The company received cash for $10\%$ of the sales and notes receivable for the remainder. Warranty payments totaled $ $18,000$ during $2024.$

Requirement $1.$ Record the$$ sales, warranty$$ expense, and warranty payments for the company. Ignore cost of goods sold. $($Record debits$$ first, then credits. Select the explanation on the last line of the journal entry$$ table.$)$

Begin with the entry to record the sales. $($Prepare a single compound entry for this$$ transaction.$)$

Date

Accounts and Explanation

Requirement $2.$ Assume the Estimated Warranty Payable is$$ $$0$ on January$1,2024.$ Post the $2024$ transactions to the Estimated Warranty Payable$$ T$-$account. At the end of $2024,$ how much in Estimated Warranty Payable does the company$$ owe?

Use the$$ T$-$account to determine the ending balance for the Estimated Warranty Payable account. Use a$$ "Beg. Bal." posting reference to show the beginning balance of the account and an$$ "End. Bal." posting reference to show the ending balance of the account.$($Enter a$"0"$ for any zero$$ amounts.$)$

Estimated Warranty Payable