i On November 10, 2020, Singh Electronics began to buy and resell scanners for $49 each....
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i On November 10, 2020, Singh Electronics began to buy and resell scanners for $49 each. Singh uses the perpetual system to account for inventories. The scanners are covered under a warranty that requires the company to replace any non-working scanner within 90 days. When a scanner is returned, the company simply throws it away and mails a new one from inventory to the customer. The company's cost for a new scanner is only $29. Singh estimates warranty costs based on 15% of the number of units sold. The following transactions occurred in 2020 and 2021 (ignore GST and PST): 2020 Nov. Dec. Jan. 15 Sold 3,000 scanners for $147,000 cash. 30 8 Recognized warranty expense for November with an adjusting entry. Replaced 100 scanners that were returned under the warranty. 15 Sold 7,000 scanners. 29 31 2021 Required: Replaced 30 scanners that were returned under the warranty. Recognized warranty expense for December with an adjusting entry. 14 Sold 260 scanners. 20 Replaced 42 scanners that were returned under the 31 warranty. Recognized warranty expense for January with an adjusting entry. 1. How much warranty expense should be reported for November and December 2020? Warranty Expense November December Total $ 2. How much warranty expense should be reported for January 2021? (Round your intermediate calculations and final answer to the nearest whole number.) Warranty expense 3. What is the balance of the estimated warranty liability as of December 31, 2020? Warranty expense for November Warranty expense for December Cost of replacing items in December Liability balance 4. What is the balance of the estimated warranty liability as of January 31, 2021? Beginning balance Warranty expense for January Cost of replacing items in January Liability balance 5. Prepare journal entries to record ALL transactions and year-end adjustments (ignore sales taxes). (Round intermediate calculations and final answer to the nearest whole number.) View transaction list Journal entry worksheet > 1 2 3 4 567 Record the sale of scanners to customers. > 8 12 Note: Enter debits before credits. Date November 15, 2020 General Journal Debit Credit Record entry View general journal Clear entry i On November 10, 2020, Singh Electronics began to buy and resell scanners for $49 each. Singh uses the perpetual system to account for inventories. The scanners are covered under a warranty that requires the company to replace any non-working scanner within 90 days. When a scanner is returned, the company simply throws it away and mails a new one from inventory to the customer. The company's cost for a new scanner is only $29. Singh estimates warranty costs based on 15% of the number of units sold. The following transactions occurred in 2020 and 2021 (ignore GST and PST): 2020 Nov. Dec. Jan. 15 Sold 3,000 scanners for $147,000 cash. 30 8 Recognized warranty expense for November with an adjusting entry. Replaced 100 scanners that were returned under the warranty. 15 Sold 7,000 scanners. 29 31 2021 Required: Replaced 30 scanners that were returned under the warranty. Recognized warranty expense for December with an adjusting entry. 14 Sold 260 scanners. 20 Replaced 42 scanners that were returned under the 31 warranty. Recognized warranty expense for January with an adjusting entry. 1. How much warranty expense should be reported for November and December 2020? Warranty Expense November December Total $ 2. How much warranty expense should be reported for January 2021? (Round your intermediate calculations and final answer to the nearest whole number.) Warranty expense 3. What is the balance of the estimated warranty liability as of December 31, 2020? Warranty expense for November Warranty expense for December Cost of replacing items in December Liability balance 4. What is the balance of the estimated warranty liability as of January 31, 2021? Beginning balance Warranty expense for January Cost of replacing items in January Liability balance 5. Prepare journal entries to record ALL transactions and year-end adjustments (ignore sales taxes). (Round intermediate calculations and final answer to the nearest whole number.) View transaction list Journal entry worksheet > 1 2 3 4 567 Record the sale of scanners to customers. > 8 12 Note: Enter debits before credits. Date November 15, 2020 General Journal Debit Credit Record entry View general journal Clear entry
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Fundamental Accounting Principles Volume II
ISBN: 978-1260305838
16th Canadian edition
Authors: Kermit Larson, Tilly Jensen, Heidi Dieckmann
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