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Please help me with this Homework problem The following selected transactions were taken from the books of Ripley Company for Year 1 : 1. On
Please help me with this Homework problem
The following selected transactions were taken from the books of Ripley Company for Year 1 : 1. On February 1, Year 1, borrowed $49,000 cash from the local bank. The note had a 6 percent interest rate and was due on June 1, Year 1. 2. Cash sales for the year amounted to $225,000 plus sales tax at the rate of 6 percent. 3. Ripley provides a 90-day warranty on the merchandise sold. The warranty expense is estimated to be 3 percent of sales. 4. Paid the sales tax to the state sales tax agency on $205,000 of the sales. 5. Paid the note due on June 1 and the related interest. 6. On November 1, Year 1, borrowed $46,000 cash from the local bank. The note had a 9 percent interest rate and a one-year term to maturity. 7. Paid $3,100 in warranty repairs. 8. A customer has filed a lawsuit against Ripley for $11 million for breach of contract. The company attorney does not believe the suit has merit. 1. What amount of cash did Ripley pay for interest during Year 1 ? 2. What amount of interest expense is reported on Ripley's income statement for Year 1 ? 3. What is the amount of warranty expense for Year 1 ? Note: For all requirements, do not round intermediate calculations. Round your final answers to nearest whole dollar amount. Show less 4Step by Step Solution
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