Question 4

Coryell Company sells computers with a 6-month warranty. It is estimated that 2% of all units sold will need repairs under warranty at an estimated cost of $800 per unit. During January, the company sold 100,000 computers at $7,000 each, and 1,500 computers were turned in for repairs during that same month. The total actual repairs costs amounted to $740,000 from the computer parts inventory. The balance in the Estimated Warranty Liability Account on January 1, 2016 was $60,000. What is the balance in the Estimated Warranty Liability Account at the end of January 2016?

	A.	$ 860,000
	B.	$2,400,000
	C.	$1,660,000
	D.	$ 920,000