Question

Question 3 To record a contingent liability as an expense, the outcome must be: Question 3...

Question 3

To record a contingent liability as an expense, the outcome must be:

Question 3 options:

Probable.

Estimable.

Both a and b.

Either a or b.

None of the above.

Question 4

Tamarron Corporation warrants its products for 6 months. The estimated product warranty is 2% of sales. Assume that sales were $600,000 for January. Determine the warranty liability at the end of January.

Question 4 options:

$0

$12,000

$10,000

Unknown
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
2. Estimated Warranty Liability Cook-Rite Co. sold $651,000 of equipment during January under a six-month warranty....
2. Estimated Warranty Liability Cook-Rite Co. sold $651,000 of equipment during January under a six-month warranty. The cost to repair defects under the warranty is estimated at 4% of the sales price. On August 15, a customer required a $274 part replacement, plus $101 of labor under the warranty. Required: (a) Provide the journal entry for the estimated warranty expense on January 31 for January sales. Jan. 31 Accounts Payable Product Warranty Expense Feedback Contingent liability entries are needed when...
Classify each of the following items as current liability (CL), long-term liability (LT), contingent liability (CO),...
Classify each of the following items as current liability (CL), long-term liability (LT), contingent liability (CO), estimated liability (EL), disclosure only (DO) or no liability (NL) Note: some but not all may have two classifications. Account CL LT CO EL DO NL Federal income taxes withheld Lawsuit against the company considered probable and not estimable at this time Warranty on products sold Accounts payable Vacation benefits 15 year building mortgage Unearned revenues FICA taxes payable Product recall due to injuries,...
Rotary Tools sells power tools and backs each product it sells with a one-year warranty against...
Rotary Tools sells power tools and backs each product it sells with a one-year warranty against defects. Based on previous experience, the company expects warranty costs to be approximately 4% of sales. By the end of the first year, sales are $800,000. Actual warranty expenses incurred so far are $12,000. 1. Does this situation represent a contingent liability? Yes No 2. Record warranty expense and warranty liability for the year based on 4% of sales 3. Record the actual warranty...
Widget company sells an industrial line of products that are all subject to a 3-year warranty....
Widget company sells an industrial line of products that are all subject to a 3-year warranty. Prior experience has resulted in an average warranty cost of 3% of revenue for its products. The company had an accrued warranty liability of $500,000 at December 2018. During January of 2019, product sales were $6 million, and the actual warranty costs incurred were $145,000. Prepare journal entries to record product sales (assume all credit sales), the warranty accrual, and actual warranty costs incurred...
1. Widget company sells an industrial line of products that are all subject to a 3-year...
1. Widget company sells an industrial line of products that are all subject to a 3-year warranty. Prior experience has resulted in an average warranty cost of 3% of revenue for its products. The company had an accrued warranty liability of $500,000 at December 2018. During January of 2019, product sales were $6 million, and the actual warranty costs incurred were $145,000. a. Prepare journal entries to record product sales (assume all credit sales), the warranty accrual, and actual warranty...
4) Arbor Industries sold their old office furniture for cash, to make way for new replacement...
4) Arbor Industries sold their old office furniture for cash, to make way for new replacement furniture. Their journal entry to record the sale will include: A) A debit to accumulated depreciation and a credit to cash B) A debit to accumulated depreciation and a credit to furniture C) A debit to depreciation expense and a credit to cash D) A debit to depreciation expense and a credit to furniture 5) A company includes warranties on all of its products...
At the end of 2022, the following information is available for Great Adventures. Additional interest for...
At the end of 2022, the following information is available for Great Adventures. Additional interest for five months needs to be accrued on the $30,000, 6% loan obtained on August 1, 2021. Recall that annual interest is paid each July 31. Assume that $10,000 of the $30,000 loan discussed above is due next year. By the end of the year, $20,000 in gift cards have been redeemed. The company had sold gift cards of $25,000 during the year and recorded...
Accrued Product Warranty Fosters Manufacturing Co. warrants its products for one year. The estimated product warranty...
Accrued Product Warranty Fosters Manufacturing Co. warrants its products for one year. The estimated product warranty is 3% of sales. Assume that sales were $208,000 for January. On February 7, a customer received warranty repairs requiring $305 of parts and $95 of labor. If an amount box does not require an entry, leave it blank. a. Journalize the adjusting entry required at January 31, the end of the first month of the current fiscal year, to record the accrued product...
1. When the occurrence of a liability is dependent on the outcome of some future event,...
1. When the occurrence of a liability is dependent on the outcome of some future event, the liability is referred to as a(n) a) commitment. b) accounts payable. c) contingent liability d) accrued liability. 2. A pension plan that pays employees benefits upon retirement based on how well the investments in the pension plan perform is called a a) defined contribution plan. b) defined performance plan. c) defined investment plan. d) defined benefit plan. 3. How should a liability that...
A company sells its product subject to a warranty that covers the cost of parts for...
A company sells its product subject to a warranty that covers the cost of parts for repairs during the six months after the date of sale. Warranty costs are estimated to be 5% of sales. During the month of July, the company preformed warranty work and used $11,000 of parts to preform the warranty work. Sales for July were $450,000 1. Record the warranty expense for the month of July. 2. Record the costs of the warranty completed in July....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT