Electric Trans manufactures and sells electric transportation devices. One of the company's products is an electric...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Electric Trans manufactures and sells electric transportation devices. One of the company's products is an electric carrier for golf clubs called a Powercaddy. A golf bag is strapped onto the Powercaddy and a handheld control is used to move the Powercaddy around the golf course. Electric Trans sells the Powercaddy for $900 and offers customers a one-year warranty. The company estimates that warranty costs will equal 5% of sales. During 20x2, the company sold 995 Powercaddys and incurred warranty costs of $41,000, paid for in cash, with respect to this product. On January 1, 20x2, Electric Trans took out an 8-year, 4%, $2,000,000 bank loan. Annual repayments on the bank loan are $287,056 and are due each December 31. Required – Prepare the adjusting journal entry to record estimated warranty expense for the year ended December 31, 20x2. Prepare the journal entry to record warranty work performed during 20x2. Prepare the journal entry to record the bank loan on January 1, 20x2 and the interest payment on December 31, 20x2. а. b. с. Electric Trans manufactures and sells electric transportation devices. One of the company's products is an electric carrier for golf clubs called a Powercaddy. A golf bag is strapped onto the Powercaddy and a handheld control is used to move the Powercaddy around the golf course. Electric Trans sells the Powercaddy for $900 and offers customers a one-year warranty. The company estimates that warranty costs will equal 5% of sales. During 20x2, the company sold 995 Powercaddys and incurred warranty costs of $41,000, paid for in cash, with respect to this product. On January 1, 20x2, Electric Trans took out an 8-year, 4%, $2,000,000 bank loan. Annual repayments on the bank loan are $287,056 and are due each December 31. Required – Prepare the adjusting journal entry to record estimated warranty expense for the year ended December 31, 20x2. Prepare the journal entry to record warranty work performed during 20x2. Prepare the journal entry to record the bank loan on January 1, 20x2 and the interest payment on December 31, 20x2. а. b. с.
Expert Answer:
Answer rating: 100% (QA)
Solution Account title and explanation Dec 3120x2 Warranty expenses Warranty liability SNo ... View the full answer
Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1119368458
7th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
Posted Date:
Students also viewed these accounting questions
-
Which one is not correct in the context of tax accounting? (a) Deferred tax liability might have resulted when tax expense on the income statement is less than tax payment based on tax code (b)...
-
Identify which of the following is an example of an unobservable input: Stock prices of listed entities Company cash flow projections Real estate transactions Spot prices for oil
-
Carrier Fabrication Company (CFC) manufactures and sells only one product, a special front-mounting bicycle rack for large vehicles. CFC entered into a one-time contract to produce an additional...
-
1.The purpose of using a balanced scorecard is for: Multiple Choice A.companies to make sure their business activities align with strategy. B.companies to compare themselves with their competitors....
-
How can activity-based costing techniques be applied to selling and administration activities?
-
Explain in your own words the adage: The average describes the past; the marginal describes the future.
-
A surface condenser having an absolute pressure of 0.10 bar is supplied with cooling water at the rate of \(40 \mathrm{~kg}\) of steam condensed. The rise in the temperature of cooling water is...
-
Narisho Supply is in the process of preparing the budget for the first quarter of 2011. The following projections for unit sales have been made: Each finished unit requires three direct materials: 4...
-
What are some of the factors that make it difficult for unions to coordinate their efforts across national borders? What is a great personal branding statement for a cyber-security human resources...
-
Air is pumped into the steel thin-walled pressure vessel at C. If the ends of the vessel are closed using two pistons connected by a rod AB, determine the increase in the diameter of the pressure...
-
When ranking acidity of organic compounds, are we suppose to look their atomic size or electronegativity? For instance, when ranking the acidic strength of o-chloro benzoic acid and o- bromo bezoic...
-
An increase in the breadth of an organizations structure is known as __________. A. centralization B. decentralization C. horizontal growth D. vertical growth
-
Strategic alliances typically involve higher bureaucratic and developmental costs when compared to mergers and acquisitions. True or False
-
The formal means by which work is coordinated in an organization is called the __________. A. organizational structure B. organizational culture C. organizational dynamic D. none of the above
-
Crisis management involves a series of steps that can be taken before a crisis occurs, while it is occurring, and after it has passed. True or False
-
Why did the budget surpluses in 2000 and 2001 give way to a series of budget deficits beginning in 2002? Why did those deficits increase substantially beginning in 2008?
-
3. Given a differential equation with initial condition dx dt (a) Use Euler's method with h = 0.1 to obtain approximate solutions of x at t = 0.5. (b) Determine the percentage error in x at t = 0.5,...
-
Place a tick in the appropriate grid to identify the balance that would be brought down in each of the following named accounts, in the books of Rizwy Mohamed: (a) In the Cash account: if Rizwy...
-
Remmers Corporation, a publicly traded company, was organized on January 1, 2018. It is authorized to issue an unlimited number of $3 noncumulative preferred shares and an unlimited number of common...
-
The financial statements of The North West Company Inc. are presented in Appendix B, followed by the financial statements for Sobeys Inc. in Appendix A. Instructions (a) Compare the statements of...
-
Maple Leaf Foods Inc. reported the following selected information (in thousands) for the three years ended December 31, 2015, 2014, and 2013: (a) Calculate Maple Leaf's receivables turnover and...
-
Define family law and identify the kinds of issues that are addressed in a family law practice.
-
Describe the role of a paralegal in a family law practice.
-
Identify the kinds of resources included in a basic family law library.
Study smarter with the SolutionInn App