Loose Leaf for Financial Accounting: Information for Decisions
9th Edition
ISBN: 9781260158762
Author: John J Wild
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Question
Chapter 9, Problem 9QS
Summary Introduction
Introduction:Warranty expenses refers to the amount of money which is actually incurred or estimated to incur on the repair or replacement of goods sold. These are for a limited period.
To prepare: The
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
On September 11, 2016, Home Store sells a mower for $560 with a one-year warranty that covers parts. Warranty expense is estimated at 12% of sales. On July 24, 2017, the mower is brought in for repairs covered under the warranty requiring $39 in materials taken from the Repair Parts Inventory. Prepare the September 11, 2016, entry to record the mower sale, and the July 24, 2017, entry to record the warranty repairs.
On September 1, Home Store sells a mower (that costs $200) for $500 with a one-year warranty that covers parts. Warranty expense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $35 in materials taken from the Repair Parts Inventory. Prepare the September 1 entry to record the mower sale (and cost of sale) and the January 24 entry to record the warranty repairs.
On December 1, Home Store sells a mower (that costs $160) for $460 cash with a one-year warranty that covers parts. Warranty
expense is estimated at 12% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the
warranty requiring $32 in materials taken from the Parts Inventory.
Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warranty
liability, and the January 24 entry to record the warranty repairs.
Note: Round your answers to 2 decimal places.
View transaction list
Journal entry worksheet
2
3
4
Record the mower sales.
Note: Enter debits before credits.
Date
December 01
General Journal
Debit
Credit
>
Record entry
Clear entry
View general journal
Chapter 9 Solutions
Loose Leaf for Financial Accounting: Information for Decisions
Ch. 9 - Prob. 1DQCh. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - What is the combined amount (in percent) of the...Ch. 9 - What is the current Medicare tax rate? This rate...Ch. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Why are warranty liabilities usually recognized on...Ch. 9 - Prob. 10DQ
Ch. 9 - Prob. 11DQCh. 9 - Prob. 12DQCh. 9 - Prob. 13DQCh. 9 - Prob. 14DQCh. 9 - Prob. 15DQCh. 9 - Prob. 16DQCh. 9 - Prob. 1QSCh. 9 - Prob. 2QSCh. 9 - Ticketsales, Inc., receives $5,000,000 cash in...Ch. 9 - Prob. 4QSCh. 9 - Prob. 5QSCh. 9 - Prob. 6QSCh. 9 - Prob. 7QSCh. 9 - Prob. 8QSCh. 9 - Prob. 9QSCh. 9 - Prob. 10QSCh. 9 - Prob. 11QSCh. 9 - Prob. 12QSCh. 9 - Sera Corporation has made and recorded its...Ch. 9 - Prob. 15QSCh. 9 - Prob. 1ECh. 9 - Prepare any necessary entries at December 31 for...Ch. 9 - Prob. 3ECh. 9 - Prob. 4ECh. 9 - Prob. 5ECh. 9 - Prob. 6ECh. 9 - Prob. 7ECh. 9 - Prob. 8ECh. 9 - Prob. 9ECh. 9 - Hitzu Co. sold a copier costing $4,800 with a...Ch. 9 - Prob. 11ECh. 9 - Prob. 12ECh. 9 - Prob. 13ECh. 9 - Prob. 14ECh. 9 - Prob. 15ECh. 9 - Prob. 16ECh. 9 - Prob. 18ECh. 9 - Prob. 19ECh. 9 - Prob. 1PSACh. 9 - Prob. 2PSACh. 9 - Paloma Co. has four employees. FICA Social...Ch. 9 - Prob. 4PSACh. 9 - Shown here are condensed income statements for two...Ch. 9 - Prob. 6PSACh. 9 - Warner Co. entered into the following transaction...Ch. 9 - Prob. 2PSBCh. 9 - Fishing Guides Co. has four employees. FICA Social...Ch. 9 - On November10, 2017, Lee Co. began operations by...Ch. 9 - Shown here are condensed income statements for two...Ch. 9 - Prob. 6PSBCh. 9 - Prob. 9SPCh. 9 - Prob. 1GLPCh. 9 - Prob. 1FSACh. 9 - Prob. 2FSACh. 9 - Prob. 3FSACh. 9 - Prob. 1BTNCh. 9 - Prob. 2BTNCh. 9 - Assume that your team is in business and you must...Ch. 9 - Prob. 5BTN
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
- Resin Milling issued a $390,500 note on January 1, 2018 to a customer in exchange for merchandise. The merchandise had a cost to Resin Milling of $170,000. The terms of the note are 24-month maturity date on December 31, 2019 at a 5% annual interest rate. The customer does not pay on its account and dishonors the note. Record the journal entries for Resin Milling for the following transactions. A. Initial sale on January 1, 2018 B. Dishonored note entry on January 1, 2020, assuming interest has not been recognized before note maturityarrow_forwardChemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?arrow_forwardOn December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan. Refer to RE6-10. On December 31, Jordan Inc. received 50,000 on assigned accounts. Prepare Jordans journal entries to record the cash receipt and the payment to McLaughlin.arrow_forward
- Shoe Hut sells custom, handmade shoes. It offers a one-year warranty on all shoes for repair or replacement. Review each of the transactions and prepare any necessary journal entries for each situation. A. May 31: Shoe Hut sells 100 pairs of shoes during the month of May at a sales price per pair of shoes of $240 cash. Shoe Hut records warranty estimates when sales are recognized and bases warranty estimates on 4% of sales. B. June 2: A customer files a warranty claim that Shoe Hut honors in the amount of $30 for repair to laces. Laces Inventory corresponds to shoelace inventory used for repairs. C. June 4: Another customer files a warranty claim that Shoe Hut honors. Shoe Hut replaces the damaged shoes at a cost of $200, affecting their Shoe Replacement Inventory account. D. August 10: Shoe Hut explores the possibility of bankruptcy, given the current economic conditions (recession). It determines the bankruptcy is unlikely to occur (remote).arrow_forwardRain T-Shirts issued a $440,600 note on January 1, 2018 to a customer, Larry Potts, in exchange for merchandise. The merchandise had a cost to Rain T-Shirts of $220,300. The terms of the note are 24-month maturity date on December 31, 2019 at a 4.5% annual interest rate. Larry Potts does not pay on his account and dishonors the note. Record journal entries for Rain T-Shirts for the following transactions. A. Initial sale on January 1, 2018 B. Dishonored note entry on January 1, 2020, assuming interest has not been recognized before note maturityarrow_forwardOn December 1, Home Store sells a mower (that costs $320) for $620 cash with a one-year warranty that covers parts. Warranty expense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $43 in materials taken from the Parts Inventory. Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warranty liability, and the January 24 entry to record the warranty repairs. Round to 2 decimal places.arrow_forward
- On December 1, Home Store sells a mower (that costs $280) for $580 cash with a one-year warranty that covers parts. Warranty expense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $41 in materials taken from the Parts Inventory. Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warranty liability, and the January 24 entry to record the warranty repairs. Note: Round your answers to 2 decimal places. View transaction list 1 2 3 4 Record the mower sales. Record the cost of mower sales. Record the estimated warranty expense. Record the cost of warranty repairs. Note : = journal entry has been entered Record entry Clear entry X Credit View general journal >arrow_forwardOn December 1, Home Store sells a mower (that costs $220) for $520 cash with a one-year warranty that covers parts. Warranty expense is estimated at 8% of sales. On January 24 of the following year, the mower is brought in for repairs covered under the warranty requiring $36 in materials taken from the Parts Inventory. Prepare the December 1 entry to record the mower sale (and cost of sale), the December 31 adjusting entry for estimated warranty liability, and the January 24 entry to record the warranty repairs. (Round your answers to 2 decimal places.) View transaction list Journal entry worksheet < 1 2 3 Record the mower sales. Date December 01 Note: Enter debits before credits. 4 General Journal Debit Creditarrow_forwardAmber gears sells gears to HTC Car Repair during 2018.It offers rebates of 2% on purchases up to $60,000 and 3% on purchases above $60,000 if the customer's purchases for the year exceed $200,000. In the past, HTC normally purchases $300,000 in parts during a calendar year. On March 25, 2018, HTC Car Repair purchased $74,000 of parts. The journal entry to record the purchase includes:arrow_forward
- On June 11 of the current year, a retailer sells a trimmer for $400 with a one-year warranty that covers parts. Warranty expense is estimated at 5% of sales. On March 24 of the next year, the trimmer is brought in for repairs covered under the warranty requiring $15 in materials taken from the Repair Parts Inventory. Prepare the (a) June 11 entry to record the trimmer sale—ignore the cost of sales part of this sales entry—and (b) March 24 entry to record warranty repairs.arrow_forwardIn December 2017, Best Buy sold 200 computers for $500 each and estimated $50/computer for warranty. Record the journal entry on December 31, 2017, for warranty accrual Record the journal entry on December 31, 2018, when Best Buy provided A. В. repairs for 100 computersarrow_forwardHitzu Company sold a copler (that costs $7.500) for $15,000 cash with a two-year parts warranty to a customer on August 16 of Year 1. Hitzu expects warranty costs to be 4% of dollar sales. It records warranty expense with an adjusting entry on December 31. On January 5 of Year 2 the copler requires on-site repairs that are completed the same day. The repairs cost $111 for materials taken from the parts inventory. These are the only repairs required in Year 2 for this copler.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Financial Accounting: The Impact on Decision Make...AccountingISBN:9781305654174Author:Gary A. Porter, Curtis L. NortonPublisher:Cengage LearningIntermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage LearningPrinciples of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Revenue recognition explained; Author: The Finance Storyteller;https://www.youtube.com/watch?v=816Q6pOaGv4;License: Standard Youtube License