Question 1 (21 points) 4 - Recommended Time Allocation: 55 Minutes, 21 Marks Tiger Limited is a manufacturer of high-powered computers Tiger's computers are sold with a typical assurance-type warranty of twelve months. At the time of a sale, the purchaser has the option to buy the computer with a 5-year extended warranty The 5-years would begin after the end of the six-month assurance-type warranty. If the purchaser chooses not to buy the 5-year extended warranty at the time of the purchase, the purchaser can still buy the 5-year extended warranty up to six months later. The following information is available regarding the manufacturer's "Pinnacle" model of computer a. When a Pinnacle is purchased as a package with the 5-year extended warranty, the selling price for the package is $19,200. This special offer is only available at the time of the initial purchase b. If the 5-year optional extended warranty were to be purchased by itself (separate from the computer), the price would be $2.000 C. The normal selling price of a Pinnacle with the assurance warranty but without the 5-year extended warranty, is $18,000. The cost of goods is $12.600 and Tiger uses a perpetual inventory system. d. Tiger estimates that its Pinnacle computer will have assurance-type warranty claims of 3.5% of the normal selling price of the computer. In all applicable situations, Tiger uses the gross method REQUIRED READ THE BELOW QUESTIONS CAREFULLY 1. January 1 If Tiger sold, on net/30 credit terms a Pinnacle with the 5-year extended warranty as a package prepare all of the applicable journal entry or entries at the date of the delivery associated with the sale (8 marks) 2. January 5 Assume that Tiger transfers the $19,200 account receivable to Factoring Company for cash on a with-recourse basis. Tiger agrees with Factoring Company that a holdback of $700 is appropriate. Factoring Company pays Tiger $15.760 cash. Prepare the journal entry or entries to reflect the above situation. (3 marks) 3. January 1. Ignore your answers to parts (1) and (2). Assume Tiger sells one Pinnacle to a customer without any extended warranty (only the Pinnacle itself is sold) on the following terms a. Cash down payment of $3,000 b. $15,000 Promissory note due three years from the date of sale. Stated interest rate is 2% Interest will be paid annually on December 31 The market rate of interest for a similar note would be 6%. Assume Tiger is permitted to recognize revenue at the date of sale Prepare the journal entry or entries for the above situation (6 marks) 4. December 31: Assume Tiger receives an interest payment relating to the promissory note receivable (part (C) above] Prepare the journal entry or entries for this situation (4 marks)