Talarczyk Company sold 10,000 Super-Spreaders on December 31, 2020, at a total price of $1,000,000, with...

 

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Talarczyk Company sold 10,000 Super-Spreaders on December 31, 2020, at a total price of $1,000,000, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $550,000. The assurance warranties extend for a 2-year period and are estimated to cost $40,000. Talarczyk also sold extended warranties (service-type warranties) related to 2,000 spreaders for 2 years beyond the 2-year period for $12,000. Given this information, determine the amounts to report for the following at December 31, 2020: sales revenue, warranty expense, unearned warranty revenue, warranty liability, and cash. Amounts Reported in Income Sales revenue 1000000 $4 Warranty Expense 40000 Amounts Reported on the Balance Sheet Unearned Service Revenue $ 12000 Cash 422000 Warranty Liability 40000 Talarczyk Company sold 10,000 Super-Spreaders on December 31, 2020, at a total price of $1,000,000, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $550,000. The assurance warranties extend for a 2-year period and are estimated to cost $40,000. Talarczyk also sold extended warranties (service-type warranties) related to 2,000 spreaders for 2 years beyond the 2-year period for $12,000. Given this information, determine the amounts to report for the following at December 31, 2020: sales revenue, warranty expense, unearned warranty revenue, warranty liability, and cash. Amounts Reported in Income Sales revenue 1000000 $4 Warranty Expense 40000 Amounts Reported on the Balance Sheet Unearned Service Revenue $ 12000 Cash 422000 Warranty Liability 40000

Answer rating: 100% (QA)

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