Early in 2 0 2 0 , Crow Equipment sold 5 0 0 Rollomatics at $ 6
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Question:
Early in Crow Equipment sold Rollomatics at $ each. During Crow spent $ servicing the year assurance warranties that accompany the Rollomatic. All applicable transactions are on a cash basis.
Instructions
a Prepare entries for Crow. Assume that Crow estimates the total cost of servicing the warranties in the second year will be $
b Prepare entries for Crow assuming that the warranties are not an integral part of the sale a servicetype warranty Assume that of the sales total, $ relates to sales of warranty contracts. Warranty costs incurred in were $ Estimate revenues to be recognized on a straightline basis.
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