The accounting records of Dees Appliances included the following balances at the end of the period: In

Question:

The accounting records of Dee€™s Appliances included the following balances at the end of the period:

In the past, Dee€™s warranty expense has been 8% of sales. During the current period, the business paid $7,100 to satisfy the warranty claims.

Requirements
1. Journalize Dee€™s warranty expense for the period and the company€™s cash payments to satisfy warranty claims. Explanations are not required.
2. Show what Dee€™s Appliances will report on its income statement and balance sheet for this situation at the end of the period.
3. Which data item from requirement 2 will affect Dee€™s current ratio? Will Dee€™s current ratio increase or decrease as a result of thisitem?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...