Sved Required information Problem 9-4A (Algo) Estimating warranty expense and liability LO P4 The following information applies to the questions displayed below.) On October 29, Lobo Co. began operations by purchasing razors for resale. The razors have a 90-day warranty. When a tazor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $13 and its retail selling price is $90. The company expects warranty costs to equal 7% of dollar sales. The following transactions occurred. Nov. 11 Sold 80 Tators for $7,200 cash. 30 Recognized warranty expense related to November sales with an adjusting entry. Dec. 9 Replaced 16 razors that were returned under the warranty. 16 Sold 240 rators for $21,600 cash. 29 Replaced 32 razors that were returned under the warranty. 31 Recognized warranty expense related to December sales with an adjusting entry. Jan.5 Sold 160 ranore for $14,400 cash. 17 Replaced 37 razors that were returned under the warranty. 31 Recognized warranty oxpenne related to January sales with an adjusting entry. Problem 9-4A (Algo) Part 1 Required: 1. Prepare journal entries to record above transactions and adjustments. View transaction dat Journal entry worksheet 4 5 6 7 12 Record the cost of goods sold for 80 razors. Note: Enter debits before credits. Date General Journal Debit Credit Nov 11 Record entry Clear entry View general journal 2 J Record the estimated warranty expense at 7% of November sales, Note: Enter debits before credits General Journal Debit Credit Nov 30 Record entry Clear entry View general journal 2 oc Record the replacement of 16 razors that were returned under the warranty. Note: Enter debits before credits. Dato General Journal Debit Credit Dec 09 Record entry Clear entry View general journal Journal entry worksheet Record the cost of goods sold for 240 razors. Note: Enter debits before credits. General Journal Debit Credit Dato Dec 16 Record entry Clear entry View general journal View transaction list Journal entry worksheet Record the estimated warranty expense at 7% of December sales. Note: Enter debits before credits. Date General Journal Dobit Credit Dec 31 Record entry Clear entry View general journal Journal entry worksheet 1 ... 5 6 7 8 9 10 11 12 Record the sales revenue of 160 razors for $14,400 cash. Note: Enter debits before credits. General Journal Debit Credit Date Jan 05 Record entry Clear entry View general journal Journal entry worksheet 1 ..... 5 6 7 8 9 10 11 12 Record the cost of goods sold for 160 razors. Note: Enter debits before credits. Date General Journal Debit Credit Jan 05 Record entry Clear entry View general Journal Journal entry worksheet 1 ..... 5 6 7 8 9 10 11 12 > Record the replacement of 37 razors that were returned under the warranty, Note: Enter debits before credits. General Journal Debit Credit Dato Jan 17 Record entry Clear entry View general journal Journal entry worksheet
