Matusek Corporation has been experiencing a higher than expected number of warranty claims in the current year,

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Matusek Corporation has been experiencing a higher than expected number of warranty claims in the current year, due mainly to less than ideal product design. For this reason, the warranty expense percentage used was changed from 2% to 3% of sales. The warranty expense for the current year was calculated using the new rate of 3% of sales. The controller estimates that if the new rate had been used in the past, an additional $150,000 worth of warranty expense would have been recorded.
(a) Does this change require a change in accounting policy? 

(b) What journal entry, if any, should Matusek record at the end of its fiscal year, December 31, 2023?

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Related Book For  book-img-for-question

Intermediate Accounting Volume 2

ISBN: 9781119740445

13th Canadian Edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy

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