A company restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, the company expects warranty costs to be approximately 5% of sales. Sales for the month of December are $530,000. Actual warranty expenditures in January of the following year were $19,500. 4. What is the balance in the Warranty Liability account after the entries in Part 2 and 3? Warranty Liability
Q: [The following information applies to the questions displayed below.] Computer Wholesalers…
A: Calculate the warranty liability as follows: Warranty liability = Warranty liability - Warranty…
Q: On November 10, Lee Co. began operations by purchasing coffee grinders for resale. The grinders have…
A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…
Q: Hopewell sells a line of goods under a six-month warranty. Any defect arising during that period is…
A: We have the following information: Hopewell has calculated that if all the goods sold in the last…
Q: Feather Motors introduced a new car that carries a five-year warranty against manufacturer's…
A: Contingent liability is a kind of liabity where it entirely depends upon any future events which was…
Q: Ecco Company sold $136,000 of kitchen appliances with six-month warranties during September. The…
A: Estimated warranty expenses are based on the rate of warranty expense on the sales price. So…
Q: Jewellery Limited manufactures and sells different kinds of handmade fine jewellery. The company…
A: As per matching principle, warranty expenses need to be recorded in the period of sale. So warranty…
Q: [The following information applies to the questions displayed below.] Computer Wholesalers…
A: Contingent liability: This is an uncertain obligation that might be incurred on a future date as a…
Q: The Weeknd Co., a machinery dealer, sells a machine for P22,200 under a 1-year warranty contract…
A: The total warranty expenses will be the aggregate of amount for parts and labor expenses.
Q: Moon Co. sells food blenders. During 2020, Moon made 37,000 blenders at an average cost of $80. It…
A: Hey, since there are multiple questions posted, we will answer the first question. If you want any…
Q: [The following information applies to the questions displayed below.] Computer Wholesalers…
A: A contingent liability is an unforeseen obligation i.e. it has a potential risk that may occur in…
Q: Hidden Hills Company manufactures and sells electronic games. Each game costs $50 to produce, sells…
A: Product Warranty expense = Sales x % of estimated warranty = (6500 games x $90) x 7% = $40,950
Q: Right Medical introduced a new implant that carries a five-year warranty against manufacturer’s…
A: Compute the amount of liability.
Q: Brooks Corporation sells computers under a 2-year warranty contract that requires the corporation to…
A: a. Journal entries are as follows: Formulae used are shown below:
Q: On November 10, 2020, Singh Electronics began to buy and resell scanners for $58 each. Singh uses…
A: Introduction Estimated warranty liability A liability account that details the expected sum that a…
Q: On November 10, 2020, Singh Electronics began to buy and resell scanners for $58 each. Singh uses…
A: Disclaimer: “Since you have posted a question with multiple sub-parts, we will solve first three…
Q: Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook…
A: 4. Estimated warranty liability balance on December 31 = Sales for the month of December x warranty…
Q: Yummy sold $656,000 of consumer electronics during July under a one-year warranty. The cost to…
A: Contingent liability may or may not arise on the occurrence of future events. Warranty liability is…
Q: Moon Co. sells food blenders. During 2020, Moon made 37,000 blenders at an average cost of $80. It…
A: Accounting equation is the basic principle of accounting which works in the a standardized form of…
Q: Consumer Corp. sells dishwashers and washing machines that come with a two-year unlimited warranty…
A: Date Accounts Titles and Explanations Debit Credit 20X5 Cash Sales Revenue (For…
Q: On November 10, 2020, Singh Electronics began to buy and resell scanners for $60 each. Singh uses…
A: Dear student, as per Bartleby guidelines we are supposed to answer only first 3 subparts as you have…
Q: Alvarado Company sells a machine for $7,400 with a 12-month warranty agreement that requires the…
A: Calculate sale of machinery and warranty expense incurred in 2020: Sale of machinery = $7,400 *…
Q: Carnes Electronics sells consumer electronics that carry a 90-day manufacturer’s warranty. At the…
A: 1.Identify whether the given situation represent loss contingency.This situation is not loss…
Q: On October 29, Lobo Co. began operations by purchasing razors for resale. The razors have a 90-day…
A: Warranty expenses on Nov 30 = $ 4800 * 8% = $ 384 Warranty Liability on Dec 9 = 12 razors * $ 16 =…
Q: East Corp. manufactures stereo systems that carry a two-year warranty against defects. Based on past…
A: Warranty expense means where the customer has given an option to repair the goods if some defect…
Q: Ecco Company sold $150,000 of kitchen appliances with six-month warranties during September. The…
A: Warranty Expense = Sales x estimated warranty expense percentage = $150,000*6% = $9,000
Q: Ryan Corporation sells portable computers under a 5-year warranty contract that requires the…
A: Cash basis and accrual basis are two methods of recognition of revenue and expenditure. Cash basis…
Q: Right Medical introduced a new implant that carries a five-year warranty against manufacturer's…
A: Contingent liability is a type of liability where it depend upon any future event on specific…
Q: Under the expense warranty approach, give the entries to reflect the above transactions (accrual…
A: Warranty liability is a liability account. Warranty expense is part of the operating expenses.
Q: Tamarisk Company sells a machine for $6,720 with a 12-month warranty agreement that requires the…
A: 1.Calculation of Sales Made Sales Value = Units x Sale Price Sales Value = 440 x 6,720 =…
Q: Wildhorse Company sells a machine for $6,750 with a 12-month warranty agreement that requires the…
A: Wildhorse company is providing the warranty on sale of the machine, here Wildhorse company have to…
Q: Blossom Equipment Company sells computers for $1,540 each and also gives each customer a 2-year…
A: Journal is a place where accounting transactions are listed in the book keeping system before ledger…
Q: A company restores and resells notebook computers. It originally acquires the notebook computers…
A: Warranty is estimated at $26,500 ($530,000*5%) On December 31.
Q: Right Medical introduced a new implant that carries a five-year warranty against manufacturer’s…
A: Compute the amount of liability:
Q: Hardin Widget Manufacturing began operations in January 2019. Hardin sells widgets that carry a two-…
A: Journal is first book for recording of transactions. It is prepared on Double-Entry System where…
Q: Kiner Equipment Company sells computers for P2,000 each and also gives cach customer a 2-year…
A: Warranty liability refers to the account of liability under which firm reports the amount of the…
Q: Sanaz Corporation sells computers under a 3-year warranty contract that requires the corporation to…
A: a. Record any necessary journal entries in 2020: Date Accounts title and explanation Debit ($)…
Q: In 20X1, Stevens Corp. began a new product line of wearable technology that carries a 24-month…
A: Sales contracts with warranty stipulates that warranty is also to be provided to the customer in…
Q: Cook-Rite sold $152,000 of consumer electronics during July under a one-year warranty. The cost to…
A: The warranty Expenses are estimated on the basis of past year experiences.
Q: Kiner Equipment Company sells computers for P2,000 each and also gives cach customer a 2-year…
A: When a company sells products to its customers, often a warranty is provided as an additional…
Q: EZ Wheels Corporation manufactures kick scooters. The company offers a one-year warranty on all…
A: Liability created during the year = Net Sales * 4% *30% = $2850 * 4% *30% = $34.20 million
Q: Cuyos, Inc., a dealer of household appliances, sells washing machines at an average price of P8,100.…
A: Current liability is described as the obligation which is to be paid within a period of one year.…
Q: Gen sells cellular phones. Each phone sells for P10,000 and carries a warranty against defects of…
A: Expected number of phones which come for repairs under warranty = 60,000 x10% = 6,000 phones
Q: alk Unlimited began business on January 1, 2003. The company manufactures and sells cell phones…
A: Warranty is the written assurance given by the product manufacturer to the purchaser, when the…
Q: On November 10, 2020, Singh Electronics began to buy and resell scanners for $60 each. Singh uses…
A: Warranty expense is the cost that the business estimates for repair or replacement of goods sold.
Q: Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook…
A: Given case is: Computer Wholesalers restores and resells notebook computers. It originally acquires…
Q: Ecco Company sold $128,000 of kitchen appliances with six-month warranties during September. The…
A: Estimated warranty liability = 7% of sales = $128000 x 7%…
Q: Dos Passos Company sells televisions at an average price of $900 and also offers to each customer a…
A: a. Record any necessary journal entries in 2020.
Q: Company Z manufactures printers, which comes with one-year warranty. During this year, Company Z…
A: Company Z sold 51000 units of printers during this year. Warranty cost to the company for every unit…
Q: Carnes Electronics sells consumer electronics that carry a 90-day manufacturer’s warranty. At the…
A: 1. Identify whether the given situation represents loss contingency. This situation is not a loss…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
- [The following information applies to the questions displayed below.] Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 6% of sales. Sales for the month of December are $570,000. Actual warranty expenditures in January of the following year were $21,500. 2. & 3. Record the necessary entries in the Journal Entry Worksheet below. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 5% of sales. Sales for the month of December are $480,000. Actual warranty expenditures in January of the following year were $17,000. Required: 1. Does this situation represent a contingent liability? 2. & 3. Record the necessary entries in the Journal Entry Worksheet below. 4. What is the balance in the Warranty Liability account after the entries in Parts 2 and 3? Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Req 4 Does this situation represent a contingent liability? Does this situation represent a contingent liability?[The following information applies to the questions displayed below.] Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 6% of sales. Sales for the month of December are $570,000. Actual warranty expenditures in January of the following year were $21,500. 4. What is the balance in the Warranty Liability account after the entries in Part 2 and 3?
- [The following information applies to the questions displayed below.] Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 6% of sales. Sales for the month of December are $570,000. Actual warranty expenditures in January of the following year were $21,500. Required:1. Does this situation represent a contingent liability?Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 6% of sales. Sales for the month of December are $600,000. Actual warranty expenditures in January of the following year were $13,000.Required:1. Does this situation represent a contingent liability? Why or why not?2. Record warranty expense and warranty liability for the month of December based on 6% of sales.3. Record the payment of the actual warranty expenditures of $13,000 in January of the following year. 4. What is the balance in the Warranty Liability account after the entries in requirements 2 and 3?Cullumber Ltd. sells computers, computer accessories, and software. On its computer sales, the company provides a one-month warranty that is included in the cost of the computer. Claims under the warranties vary from replacing defective items to providing customers with refunds if they choose. During 2024, the estimated costs related to the one-month warranties was $52,000, of whic $46,800 had been incurred before year end ($39,000 for replacement items and $7,800 in refunds). For an additional charge of $130, Computers Galore also offers extended warranty coverage for two years on its computers. This amount is expected to cover the costs associated with the extended warranties. During 2024, Computers Galore sold 1,040 two-ye warranties. The costs incurred during the year for replacements under these warranties amounted to $40,300. Based on experienc the company estimates that its total warranty costs over the two-year coverage period will be $78,000, which it expects will occur evenly…
- Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 5% of sales. Sales for the month of December are $420,000. Actual warranty expenditures in January of the following year were $14,000. Required: 1. Record warranty expense and warranty liability for the month of December based on 5% of sales. 2. Record the payment of the actual warranty expenditures of $14,000 in January of the following year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Record warranty expense and warranty liability for the month of December based on 5% of sales. Note: If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. View…Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 4% of sales. Sales for the month of December are $400,000. Actual warranty expenditures in January of the following year were $13,000. Required: 1. Does this situation represent a contingent liability? 2. & 3. Record the necessary entries in the Journal Entry Worksheet below. 4. What is the balance in the Warranty Liability account after the entries in Parts 2 and 3?Gen sells cellular phones. Each phone sells for P10,000 and carries a warranty against defects of period of 1 year counting from the date of purchase. The firm sold 60,000 phones in 2019. Past experience indicates that 10% of the phones will need some type of repair during the warranty period. In the past, the firm has incurred expenditures at P400 on each telephone needing repair due to manufacturing defects. At the beginning of the year, the Estimate Liability for Warranties account had a credit of P59,400. Actual expenditures during the year amounted to P1.5M. The balance of the Estimated Liability for Warranties at year-end is: O 500,000 O 2,400,000 O 1,500,000 0 950,000
- Wally's Party Warehouse provides wholesale party equipment and materials to party shops. In 2022, Wally's sold 30 bounce houses at $30,000 each. The bounce houses carry a three-year warranty for defects. Wally estimates that repair costs will average 2% of the total selling price. The estimated warranty liability at the beginning of the year was $26,000. Claims of $19,000 were actually incurred during the year to honour warranties. Required: What was the balance in the Estimated Warranty Liability account at the end of the year?Wally's Party Warehouse provides wholesale party equipment and materials to party shops. In 2022, Wally's sold 30 bounce houses at $30,000 each. The bounce houses carry a three-year warranty for defects. Wally estimates that repair costs will average 2% of the total selling price. The estimated warranty liability at the beginning of the year was $26,000. Claims of $19,000 were actually incurred during the year to honour warranties. Required: What was the balance in the Estimated Warranty Liability account at the end of the year? fill in the blank 1Required information [The following information applies to the questions displayed below.] Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 5% of sales. Sales for the month of December are $480,000. Actual warranty expenditures in January of the following year were $17,000.