Problem 2 (20 marks) The two most popular products of Lestrange & Co. are its gel nail kits and its deluxe hair straightening irons. The company's fiscal year ended December 31, 20X5 One of the reasons for the popularity of its nail kits is that customers who have purchased 10 bottles of Lestrange's nail polish receive a S10 coupon towards the purchase of a nail kit. Nail kits sell for $185 each. Lestrange estimates that 20% of its nail polish customers will purchase enough bottles to get the coupon and then redeem it against the purchase of the nail kit The deluxe hair straightening irons are popular due to the one-year warranty offered, which is longer than the competition's 90-day warranty Each hair straightening iron sells for $235. Lestrange estimates that warranty costs will be an average of S15 per iron. Unit sales during the year were Nail kits Nail polish Straightening irons 10,000 150,000 8,000 During the year, 500 customers redeemed coupons and purchased nail kits. Actual warranty costs incurred were $115,000 Opening warranty liability was $134,000 and opening provision for coupons was $12,000 Required Calculate the ending balances in Lestrange's provisions as of December 31, 20X5 Problem 2 (20 marks) The two most popular products of Lestrange & Co. are its gel nail kits and its deluxe hair straightening irons. The company's fiscal year ended December 31, 20X5 One of the reasons for the popularity of its nail kits is that customers who have purchased 10 bottles of Lestrange's nail polish receive a S10 coupon towards the purchase of a nail kit. Nail kits sell for $185 each. Lestrange estimates that 20% of its nail polish customers will purchase enough bottles to get the coupon and then redeem it against the purchase of the nail kit The deluxe hair straightening irons are popular due to the one-year warranty offered, which is longer than the competition's 90-day warranty Each hair straightening iron sells for $235. Lestrange estimates that warranty costs will be an average of S15 per iron. Unit sales during the year were Nail kits Nail polish Straightening irons 10,000 150,000 8,000 During the year, 500 customers redeemed coupons and purchased nail kits. Actual warranty costs incurred were $115,000 Opening warranty liability was $134,000 and opening provision for coupons was $12,000 Required Calculate the ending balances in Lestrange's provisions as of December 31, 20X5