Soundgarden Company sold 200 copymaking machines in 2008 for $4,000 apiece, together with a one-year warranty. Maintenance
Question:
Soundgarden Company sold 200 copymaking machines in 2008 for $4,000 apiece, together with a one-year warranty. Maintenance on each machine during the warranty period averages $330.
Instructions
(a) Prepare entries to record the sale of the machines and the related warranty costs, assuming that the accrual method is used. Actual warranty costs incurred in 2008 were $17,000.
(b) On the basis of the data above, prepare the appropriate entries, assuming that the cash basis method is used.
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Related Book For
Intermediate Accounting principles and analysis
ISBN: 978-0471737933
2nd Edition
Authors: Terry d. Warfield, jerry j. weygandt, Donald e. kieso
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