Prist Co. had not provided a warranty on its products, but competitive pressures forced management to add
Question:
Prist Co. had not provided a warranty on its products, but competitive pressures forced management to add this feature at the beginning of 2019. Based on an analysis of customer complaints made over the past two years, the cost of a warranty program was estimated at 0.7% of sales. During 2019, sales totaled $3,600,000. Actual costs of servicing products under warranty totaled $22,100.
Required:
Use the horizontal model (or write the journal entries) to show the effect of having the warranty program during 2019.
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a 2019 estimated warranty expense 3600000 07 25200 Dr Warranty Expense 25200 Cr Estimated Warranty L...View the full answer
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Related Book For
Accounting What the Numbers Mean
ISBN: 978-1260565492
12th edition
Authors: David Marshall, Wayne McManus, Daniel Viele
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