Question

A company has a selling price of $1,800 each for its printers. Each printer has a...

A company has a selling price of $1,800 each for its printers. Each printer has a 2 year warranty that covers replacement of defective parts. It is estimated that 2% of all printers sold will be returned under the warranty at an average cost of $150 each. During November, the company sold 30,000 printers, and 400 printers were serviced under the warranty at a total cost of $55,000. The balance in the Estimated Warranty Liability account at November 1 was $29,000.

Calculate and record the company’s warranty expense for November 2016.

What is the balance of the estimated warranty liability as of November 30, 2016? Show all work!

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

In case of any doubts or Issues, please comment below

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
the michael bolton company (MBPC) sold 750000 printers in 2018. MBPC includes an assurance and does...
the michael bolton company (MBPC) sold 750000 printers in 2018. MBPC includes an assurance and does not use modified cash basis method.MBPC estimates that 2% of the printer requires repair under two year warranty at an average cost of $225. during 2018 MBPC spent $1,875,000 to make warranty repairs. 1 prepare the journal entry to recognized revenue warranty expense for 2018 2. the balance in the estimate warranties liability account was 1,500,000 on jan 1 2018. what wii be balance...
AD Printers Pte Ltd (“AD” or the “Company”) is a company manufacturing and selling 3-D printers....
AD Printers Pte Ltd (“AD” or the “Company”) is a company manufacturing and selling 3-D printers. Bernard is the Sales Director of AD and was specifically instructed by the Chief Executive Officer of AD to achieve S$1 million in sales per year. At a recent networking event that he organised to meet potential customers, Bernard spoke with Charrie and Diana who were looking to purchase a 3-D printer. Charrie had never purchased anything from AD before, and was concerned that...
Jordan Tire Co. sells tires and guarantees them as long as the customer owns them. If...
Jordan Tire Co. sells tires and guarantees them as long as the customer owns them. If a tire fails, the customer is charged a percentage of the retail price based on the percentage of the tire that is worn, plus a service charge for putting the tire on the ear. In the past, management found that only 2 percent of the tires sold required replacement under warranty, and of those replaced an average 20 percent of the cost is collected...
Alpha Company sells widgets for $20 each. The widget has a one year warranty. Alpha estimates...
Alpha Company sells widgets for $20 each. The widget has a one year warranty. Alpha estimates that 6% of the widgets will require repair during the warranty period. The estimated average repair cost is $4.30 per widget. On July 31, the Estimated Warranty Liability account had a normal balance of $15,000. During August, sales were $70,000. During August, 550 widgets were repaired under the warranty agreement with an actual cost of $4.50 each. Use this information to determine: 1. The...
Fitwalker sells its activity tracking device to consumers. Each device has a 2-year manufacturers warranty for...
Fitwalker sells its activity tracking device to consumers. Each device has a 2-year manufacturers warranty for defects. The company expects that 3% of the units sold will prove to be defective in the first year that it is sold. The cost to repair each Fitwalker is $50. The company sold 10,500 units in 2016. The actual cost of the repairs were $8,300 in 2016 and 7,450 in 2017. How many units does Fitwalker expect to be defective? Calculate the warranty...
Merritt Equipment Company sells computers for $1,300 each and also gives each customer a 2-year warranty...
Merritt Equipment Company sells computers for $1,300 each and also gives each customer a 2-year warranty that requires the company to perform periodic services and to replace defective parts. During 2017, the company sold 950 computers. Based on past experience, the company has estimated the total 2-year warranty costs as $40 for parts and $60 for labor. (Assume sales all occur at December 31, 2017.) In 2018, Merritt incurred actual warranty costs relative to 2017 computer sales of $12,400 for...
32. Burke Company sold 5,000 widgets this month. The widgets have a warranty for free replacement....
32. Burke Company sold 5,000 widgets this month. The widgets have a warranty for free replacement. In the past, an average of 10% of widgets sold were eventually replaced under the warranty. The cost of producing a widget is $25. This month, 420 widgets were actually replaced under the warranty. The journal entry for the 420 units replaced under warranty in the current month would be: a. debit Inventory, $10,500; credit Estimated Warranty Liability, $10,500 b. debit Estimated Warranty Liability,...
Pr. 13-156—Warranties. Merritt Equipment Company sells computers for $1,500 each and also gives each customer a...
Pr. 13-156—Warranties. Merritt Equipment Company sells computers for $1,500 each and also gives each customer a 2-year warranty that requires the company to perform periodic services and to replace defective parts. During 2017, the company sold 1,200 computers. Based on past experience, the company has estimated the total 2-year warranty costs as $40 for parts and $60 for labor per unit. (Assume sales all occur at December 31, 2017.) In 2018, Merritt incurred actual warranty costs relative to 2017 computer...
During 2017, Concord Outboards sold 180 outboard engines for $220 each. The engines are under a...
During 2017, Concord Outboards sold 180 outboard engines for $220 each. The engines are under a one-year warranty for parts and labor, and from past experience, the company estimates that, on average, warranty costs will equal $24 per engine. As of December 31, 2017, 60 engines had been serviced at a total cost of $1,410. During 2018, engines were serviced at a total cost of $2,910. Assume that all repairs used cash. (a) Prepare the journal entries that would be...
A company has $25 per unit selling price, $7.00 per unit in variable production cost and...
A company has $25 per unit selling price, $7.00 per unit in variable production cost and $2.00 per unit in variable selling and administrative cost. The annual fixed production cost is $400,000. The annual fixed selling and administrative cost is $50,000. Complete the table below for each year. Assume a FIFO flow. 2016 Units Produced 120,000 Units Sold 110,000 1- Operating income under variable costing 2- Operating income under absorption costing
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT