Question
Tamarisk Company sold 9,800 Super-Spreaders on December 31, 2020, at a total price of $970,200, with a warranty guarantee that the product was free of
Tamarisk Company sold 9,800 Super-Spreaders on December 31, 2020, at a total price of $970,200, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $499,800. The assurance warranties extend for a 2-year period and are estimated to cost $43,500. Tamarisk also sold extended warranties (service-type warranties) related to 2,200 spreaders for 2 years beyond the 2-year period for $13,200. Given this information, determine the amounts to report for the following at December 31, 2020: sales revenue, warranty expense, unearned warranty revenue, warranty liability, and cash.
Amounts Reported in Income | ||
Sales revenue | $ | |
Warranty Expense | ||
Amounts Reported on the Balance Sheet | ||
Unearned Service Revenue | $ | |
Cash | ||
Warranty Liability |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started