The accounting records of Rick's Appliances included the following balances at the end of the period:

In the past, Rick's warranty expense has been $6\%$ of sales. During the current period, the business paid $$6,000$ to satisfy the warranty claims.

Requirements

Journalize Rick's warranty expense for the period and the company's cash payments to satisfy warranty claims. Explanations are not required.

Show what Rick's will report on its income statement and balance sheet for this situation at the end of the period.

Which data item from requirement $2$ will affect the current ratio? Will Rick's current ratio increase or decrease due to this item?

The accounting records of Rick's Appliances included the following balances at the end of the period:

In the past, Rick's warranty expense has been $6\%$ of sales. During the current period, the business paid $$6,000$ to satisfy the warranty claims.

Requirements

Journalize Rick's warranty expense for the period and the company's cash payments to satisfy warranty claims. Explanations are not required.

Show what Rick's will report on its income statement and balance sheet for this situation at the end of the period.

Which data item from requirement $2$ will affect the current ratio? Will Rick's current ratio increase or decrease due to this item?