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Pls answer the following followed by a journal entry to record the sale (perpetual inventory system), the adjustment on Dec 31 to eecord the warranty
Pls answer the following followed by a journal entry to record the sale (perpetual inventory system), the adjustment on Dec 31 to eecord the warranty expense and the repairs that occured in Jan 2021 (ignoring the taxes)
On October 6, 2020, Norwood Co., an office equipment supplier, sold a coples for cash of $25,000 (cost $15,900) with a two-year parts and labour warranty. Based on prior experience, Norwood expects eventually to incur warranty costs equal to 4% of the selling price. The fiscal year coincides with the calendar year. On January 15, 2021, the customer returned the copler for repairs that were completed the same day. The cost of the repairs consisted of 5468 for the materials taken from the parts inventory and $558 of labour that was fully paid with cash. These were the only repairs required in 2021 for this copier Required: 1. How much warranty expense should the company report in 2020 for this copier? Warranty expense 2. How much is the warranty liability for this copier as of December 31, 2020? Warranty ability 3. How much warranty expense should the company report in 2021 for this copler? Warranty experte 4. How much is the warranty liability for this copier as of December 31, 2021? Warranty Nabilly De Step by Step Solution
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