VIX Corp. was incorporated on January 1, 2020. The company sells its products with a 75-day...

  

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VIX Corp. was incorporated on January 1, 2020. The company sells its products with a 75-day warranty for defective merchandise. VIX estimates that 4% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $15. The units sold and units defective that occurred during the last 2 months of 2020 are as follows. Month November December Units Sold 29,000 33,800 Units Defective Prior to December 31 mi 570 350 Required: Answer the following THREE parts. (a) Prepare the journal entry to record the costs incurred in honoring 920 warranty claims. Assume actual costs of $15,000 and expenditures are for repair costs. (Hint: The beginning balance of warranty liability is zero.) Debit tem noile Diezels zirb viw nislqz3 noitesino Credit oidua ton ai lliwboog 2111 oball (d) 225) 10 29mil 2009 moitamoldog vagona ed Debit (b) Prepare the journal entry to record the provision for warranties. Credit 2201 10 il AUO3 ni sitemaldongellauiqsono ad es izzato (c) Prepare the journal entry to record the honoring of 530 warranty contracts in January 2021 at an average cost of $15. Assume expenditures are for repair costs. Debit Credit VIX Corp. was incorporated on January 1, 2020. The company sells its products with a 75-day warranty for defective merchandise. VIX estimates that 4% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $15. The units sold and units defective that occurred during the last 2 months of 2020 are as follows. Month November December Units Sold 29,000 33,800 Units Defective Prior to December 31 mi 570 350 Required: Answer the following THREE parts. (a) Prepare the journal entry to record the costs incurred in honoring 920 warranty claims. Assume actual costs of $15,000 and expenditures are for repair costs. (Hint: The beginning balance of warranty liability is zero.) Debit tem noile Diezels zirb viw nislqz3 noitesino Credit oidua ton ai lliwboog 2111 oball (d) 225) 10 29mil 2009 moitamoldog vagona ed Debit (b) Prepare the journal entry to record the provision for warranties. Credit 2201 10 il AUO3 ni sitemaldongellauiqsono ad es izzato (c) Prepare the journal entry to record the honoring of 530 warranty contracts in January 2021 at an average cost of $15. Assume expenditures are for repair costs. Debit Credit

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