Carpenter Inc. estimates warranty expense at 3% of sales. Sales during the year were $8 million and warranty expenditures were $53,000. What was the balance in the Warranty Liability account at the end of the year? $202,000. $240,000 $187,000 $53,000

Carpenter Inc. estimates warranty expense at 3% of sales. Sales during the year were $8 million and warranty expenditures were $53,000. What was the balance in the Warranty Liability account at the end of the year? $202,000. $240,000 $187,000 $53,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: ournalize the following transactions for Howard Company: Dec. 31 The accrued product warranty…

A: Journal entries are an important part of financial accounting because they ensure that all financial…

Q: A company's sales for January are $250,000. If the company projects warranty obligations to be 5% of…

A: A warranty is a provision created by a company by keeping aside funds which are a percentage of the…

Q: 1. On June 8, Williams Company issued an $70,894, 9%, 120-day note payable to Brown Industries.…

A: Interest = Value of Note * Interest Rate * No. of DaysInterest = $70,894 * 9% * 120/360Interest =…

Q: entry to record the warranty liability

A: Warranty liability is recorded by debiting warranty expense and crediting provision for warranty.

Q: Mackenzie Corp. is preparing the December 31, 2023, year-end financial statements. Following are…

A: Adjusting Entries :— It is the journal entry made at the ending the accounting period to adjust the…

Q: Sterling Inc. has two long-term notes outstanding. One is a five-year note for $50,000. An equal…

A: The balance sheet represents the financial position of the business with assets and liabilities on a…

Q: As of January 1, 2021, NUBD Co. had an accounts receivable of P500,000. The sales for January,…

A: Budgets are the quantitative form of actions to be taken in future. Budgeted cash receipts will show…

Q: lingerland borrowed $6,000 on July 20, at 11% interest. If the loan was due on October 15, what was…

A: given, p= $6000 r = 11% n = 87 ( july 20 - oct 15)

Q: NYJ, Inc. borrowed $500,000 on November 1, 20X1, and signed a nine-month note bearing interest at…

A: The notes payable require the borrower company to pay interest expense. The interest expense is…

Q: Grant Co. had the following liabilities at December 31, the end of its fiscal year: Accounts Payable…

A: A liability is something a person or company owes, usually a sum of money. Liabilities are settled…

Q: White Hat Digital, Inc. starts the year with a credit balance of $3,500 in its Estimated Warranty…

A: The estimated warranty expenses are 2% of $224000. Opening warranty balance was $3500 and settlement…

Q: A company's sales for January are $250,000. If the company projects warranty obligations to be 5% of…

A: Formula used: Warranty liability = Sales x Warranty obligations percentage

Q: Abaca Company's accounts receivable is P240,000 at the beginning of the year and 280,000 at the end…

A: 1. 6× means 6 times. Accounts Receivables turnover ratio is 6 times. 2. Total Sales…

Q: On Dec. 8, Sheffield Company discounted at Sunshine Bank a $7,200 (maturity value), 122-day note…

A: Discount rate9%Maturity value $ 7,200.00Noted Period122days

Q: During its first year of operations Keene Limited had sales of $76,500. The company offers a 2- year…

A: Warranty liability will be reported on liabilities section of balancesheet.Warranty expense = Sales…

Q: On November 1, Alan Company signed a 120-day, 11% note payable, with a face value of $23,400. What…

A: The time value of money (TVM) is a fundamental concept in finance that reflects the idea that a…

Q: FDNACCT Co. purchased merchandise and issued a twelve-month promissory note with 8% interest and…

A: Journal Entries - Journal Entries are the recording of transactions of the organization. It is…

Q: Osman Corp. sells Product CC15 for $126.00 each. Each unit is covered by a three year warranty, and…

A: Warranty expenses is the cost that a business expects to or has already incurred for the repair or…

Q: Rosewood Company made a loan of $11,000 to one of the company's employees on April 1, Year 1. The…

A: NOTES PAYABLE Notes Payable is Generally Long Term Liabilities & Shown under the Non Current…

Q: Company factored P6,000,000 of accounts receivable to a certain bank at the end of current year.…

A: Total Cost -: The Total Cost is the actual cost that occurred in the generation of a provided level…

Q: Relay Company estimated that annual warranty expense at 2% of annual net sales. The net sales for…

A: Introduction: Warranty is a contingent liability that the organization records in its books of…

Q: Kimber Sales offers warranties on all their electronic goods. Warranty expense is estimated at 3.5%…

A: Journal entries are the entries to be recorded in the general journal of the company's books for all…

Q: A company needs to record six months of accrued interest on a four-year, 12%, $12,000 promissory…

A: Interest expense accrued = Promissory note payable x rate of interest x months/12

Q: Account Name Required a. Record the entries in Year 1 to (1) record actual cash warranty costs and…

A: The warranty expense is calculated on the basis of previous years' experiences. It is estimated at…

Q: On September 1, Purifier Company borrowed $12,000 on a 6-month, 4%, short-term note payable. How…

A: Interest will be paid on March 1 = Amount borrowed x rate of interest x no. of months / 12 months

Q: The Amherst Corporation has a 45-day accounts receivable period. The estimated quarterly sales for…

A: Balance at the beginning of Second quarter = Balance at end to quarter 1Balance at the end of…

Q: Assuming a 360-day year, proceeds of $52,258 were received from discounting a $52,919, 90-day note…

A: A bank is a financial institution that regulates the money supply in an economy. A note is a…

Q: atek Watch Company estimates that warranty costs will equal 2% of sales. In September, total sales…

A: Estimated warranty cost Total sales * 2% $400,000 * 2% $8000

Q: Use the information for the next two (2) questions. Bold Company estimated annual warranty expense…

A: Lets understand the basics. Warranty expense is an expense which are incurred to meet the warranty…

Q: On June 5 Glover Co. issued a $60,000, 6%, 120-day note payable to Jones Co. How much will Glover…

A: Step 1: Formula Interest = Principal x interest rate x yearMaturity value = Principal + Interest…

Q: On January 1, New York Company borrowed $180,000 to purchase machinery and agreed to pay 5% interest…

A: FUTURE VALUE Future value is the value of an asset at a specific date. Future value is the value…

Q: At the beginning of the year, Laurier Inc. had a balance in its warranty liability account of $…

A: When a company sells its products, it gives a warranty for repair/replacement within a certain…

Q: TJ made a loan of $16,000 to one of the company's employees on April 1, year 1. The one year note…

A: The answer is option (A.) [i.e, $720] Refer Step 2 for Explanation.

Q: During 2020, Jesse Jericho Enterprises Corporation recorded credit sales of $786,000. At the…

A: The receivable turnover ratio is computed by dividing the net credit sales during a period by the…

Q: Mackenzie Corp, is preparing the December 31, 2020, year-end financial statements. Following are…

A: Adjusting Entries :— It is the journal entry made at the ending the accounting period to adjust the…

Q: Mackenzie Corp. is preparing the December 31, 2023, year-end financial statements. Following are…

A: Adjusting Entries :— It is the journal entry made at the end of the accounting period to adjust the…

Q: Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest…

A: Payment should be credit by cash. Interest expense and LT notes payable is debited.

Q: The Price is Right manufactures electronic systems. The company provides a one-year warranty for all…

A: The warranty liability is estimated on the basis of past years experiences and the number of units…

Q: On July 8, Action Co. issued an $80,000, 6%, 90-day note payable to Scanlon Co. Assuming a 360-day…

A: The note is the liability on which a specific percentage of interest has to be paid over the…

Q: ABC Company borrows $497,000 from the bank at 7% for a three year period on Jan. 01. The loan will…

A: As per IFRS 9 Financial instruments, Borrowing from bank will be considered as Financial liability…

Q: Assuming a 360-day year, proceeds of $43,722 were received from discounting a $44,958, 90-day note…

A: Step 1:Given thatFace value of bond = $44,958Discounted price of bond = $43,722 So discount value =…

Q: Assuming a 360-day year, proceeds of $45,552 were received from discounting a $46,830, 90-day note…

A: Time value of money: The value of money changes over a period time. The value of money depends on…

Q: Rosewood Company made a loan of $11,600 to one of the company's employees on April 1, Year 1. The…

A: ### 1. Calculate Total Interest for One Year: - **Principal (P):** $11,600 - **Interest Rate (r):**…

Q: The company had sales of $3,400,000. The estimated % that will be returned under the warranty is…

A: It refers to the assurance given by a company to another individual or organisation about particular…

Q: Made sales of $22,000. McCleary estimates that warranty expense is 2% of sales. (Record only the…

A: Warranty expenses = $22, 000*2% =$440

Q: Product A comes with a two year warranty when purchased by customers. The estimated warranty costs…

A: Warranty expense is an expense related to the repair, replacement, or compensation to a user for any…

Question

$202,000.
$240,000
$187,000
$53,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

On September 1, Year 1, West Company borrowed $34,000 from Valley Bank. West agreed to pay interest annually at the rate of 9% per year. The note issued by West carried an 18-month term. West Company has a calendar year-end. What is the amount of interest expense that will be reported on West's income statement for Year 1? Multiple Choice O O $-0- $1,020 $306 $765
On July 1, 20X1, ABC Corp received a P450,000 10% 3-year note from a customer. The principal and interest of the note is collectible in 3 equal payments every June 30, starting June 30, 20X2. How much is interest income at Dec 31, 20X2? 22,500 45,000 135,000 0
Al Reem Co. signed an $18,000 six-month note payable on September 1 that bears intérest at a rate of 5%. How much is the total interest to be accrued on this note at December 31? O a. $300. O b. $900. O c. $75. O d. $450.
A company borrows $60,000 by signing a $60,000, 8% 6-year note that requires equal payments of $!2,979 at the end of each year. The first payment will record an interest expense of $4,800 and will reduce principal by $__________.
The companys balance sheet showed an accounts receivble balance of $80,000 at the begininng of the year and $47,000 at the end of the year. The company reported $720,000 in credit sales for the year. What was the amount of cash collected on account receivables durig the year
ss
Grouper Ltd. manufactures a line of amplifiers that carry a three-year warranty against defects. Based on experience, the estimated warranty costs related to dollar sales are as follows: first year after sale-3% of sales; second year after sale-4% of sales; and third year after sale-5% of sales. Sales and actual warranty expenditures for the first three years of business were: Sales Warranty Expenditures 2021 $870,000 $17,100 2022 1,010,000 48,400 2023 1,041,000 80,000 (a) Calculate the amount that Grouper should report as warranty expense on its 2023 income statement and as a warranty liability on its December 31, 2023 SFP using the assurance-type warranty (expense-based approach). Assume that all sales are made evenly throughout each year and that warranty expenditures are also evenly spaced according to the rates above. Warranty expense $ Warranty liability $
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of the year, $360,000: allowance for uncollectible accounts at the beginning, $30,000, credit sales during the year, $1,800,000; accounts receivable written off during the year $19,200; cash collections from customers; $1,740,000. the company estimates that the required year-end balance in the allowance for uncollectible accounts should be $40,080. What is the year-end gross and net accounts receivable balance?
The balance in Accounts Receivable was $650,000 at the beginning of the year and $770,000 at the end of the year. Credit sales for the year totaled $4,120,000. During the year, $450,000 in customer accounts were written off. How much cash was collected from customers during the period? A) $3,550,000 B) $4,000,000 C) $4,450,000 D) $4,690,000 10
During Year 1, its first year of operations, Benitez Co. reported sales of $360,000. At the end of Year 1, the company estimated its warranty obligation at 2% of sales. During Year 1, the company paid $4,800 cash to settle warranty claims. Which of the following statements is true? Multiple Choice Warranty expenses would decrease net earnings by $7,200 in Year 1. All of these answer choices are correct. The warranties payable account has a balance of $2,400 at the end of Year 1. Cash decreased by $4,800 as a result of the accounting events associated with warranties in Year 1.
Grant Co. had the following liabilities at December 31, the end of its fiscal year: Accounts Payable $56,000 Salaries Payable 12,200 Unearned Fees 8,900 Income Taxes Payable 3,200 Notes Payable 240,000 The note payable is an 8-year note with $30,000 due in the next year. Prepare the liabilities section of the balance sheet for the company. Grant Co. Balance Sheet December 31 Current liabilities: Total current liabilities: Long-term liabilities: Total liabilities
Stable Enterprises had sales of $230,000 in Year 1. Stable warrants its products and estimates warranty expense to be 4% of sales. In Year 2 Stable paid $9,000 cash to settle warranty obligations. Which of the following journal entries would be required to recognize the settlement of the warranty obligations? Multiple Choice O Account Titles Warranty Expense Cash Account Titles Warranty Expense Warranty Payable Account Titles Warranty Payable Debit $9,000 Debit $9,200 Debit $9,000 Credit $9,000 Credit $9,200 Credit.