Question $6$ of $6$

$\frac{2}{{123}^1}-=,$:

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Swifty Company sells automatic can openers under a $75-$day warranty for defective merchandise. Based on past experience, Swifty estimates that $4\%$ of the units sold will become defective during the warranty period.

Management estimates that the average cost of replacing or repairing a defective unit is $$20.$ The units sold and units defective that occurred during the last $2$ months of $2022$ are as follows.

$\backslash$table$[[$Month$,$Units Sold,Units Defective Prior to December $31],[$November$,31,600,632],[$December$,33,600,420]]$

$($a$)$

Your answer is correct.

Prepare the journal entry to record the costs incurred in honoring $1,052$ warranty claims. $($Assume actual costs of $$21,040.)($Credit account titles are automatically indented when amount is entered. Do not indent manually.$)$

Account Titles and Explanation

Debit

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:$\text{'}$

Warranty Expense

$21040$

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:$$:

F$1$

F$2$

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$(0)$

$c$

F$6$

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$1$

$2$

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F$4$

F$5$

$3$

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$\%$

$5$

$6$

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$7$

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Current Attempt in Progress

Your answer is partially correct.

Barbara Ripley and Fred Nichols decide to organize the ALL$-$Star partnership. Ripley invests $$25,200$ cash, and Nichols contributes $$17,000$ cash and equipment having a book value of $$5,376.$

Prepare the entry to record Nichols's investment in the partnership, assuming the equipment has a fair value of $$6,720.($Credit account titles are automatically indented when amount is entered. Do not indent manually.$)$

$\backslash$table$[[$Account Titles and Explanation,Debit$],[$Cash$,],[$Fred Nichols, Capital,$]]$

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