Ecco Company sold $155,000 of kitchen appliances with six-month warranties durin September. The cost to repair defects under the warranty is estimated at 5% of the sales price. On October 15, a customer required a $120 part replacement, plus $90 labor under the warranty. Required: Provide the journal entry for (a) the estimated expense on September 30 and (b) the October 15 warranty work. Refer to the Chart of Accounts for exact wording of account titles.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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**Ecco Company sold $155,000 of kitchen appliances with six-month warranties during September. The cost to repair defects under the warranty is estimated at 5% of the sales price. On October 15, a customer required a $120 part replacement, plus $90 labor under the warranty.**

**Required:**

*Provide the journal entry for (a) the estimated expense on September 30 and (b) the October 15 warranty work. Refer to the Chart of Accounts for exact wording of account titles.*
Transcribed Image Text:**Ecco Company sold $155,000 of kitchen appliances with six-month warranties during September. The cost to repair defects under the warranty is estimated at 5% of the sales price. On October 15, a customer required a $120 part replacement, plus $90 labor under the warranty.** **Required:** *Provide the journal entry for (a) the estimated expense on September 30 and (b) the October 15 warranty work. Refer to the Chart of Accounts for exact wording of account titles.*
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