Question

The following transactions of Brooks Garrett occurred during 2014:
Apr. 30 Garrett is party to a patent infringement lawsuit of $ 200,000. Garrett’s attorney is certain it is remote that Garrett will lose this lawsuit.
Jun. 30 Estimated warranty expense at 2% of sales of $ 400,000.
Jul. 28 Warranty claims paid in the amount of $ 6,000.
Sep. 30 Garrett is party to a lawsuit for copyright violation of $ 100,000. Garrett’s attorney advises that it is probable Garrett will lose this lawsuit. The attorney estimates the loss at $ 100,000.
Dec. 31 Garrett estimates warranty expense on sales for the second half of the year of $ 500,000 at 2%.

Requirements
1. Journalize required transactions, if any, in Garrett’s general journal. Explanations are not required.
2. What is the balance in Estimated Warranty Payable?



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  • CreatedJanuary 16, 2015
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