On January $2,2025,$ Pharoah Company sells production equipment to Coronado Inc. for $$52,000.$ Pharoah includes a $2-$year

assurance warranty service with the sale of all its equipment. The customer receives and pays for the equipment on January $2,2025.$

During $2025,$ Pharoah incurs costs related to warranties of $$890.$ At December $31,2025,$ Pharoah estimates that $$640$ of warranty

costs will be incurred in the second year of the warranty.

$($a$)$

Prepare the journal entry to record this transaction on January $2,2025,$ and on December $31,2025($assuming financial

statements are prepared on December $31,2025).($Credit account titles are automatically indented when the amount is entered. Do not

indent manually. If no entry is required, select $"$No entry" for the account titles and enter $0$ for the amounts. List all debit entries before

credit entries. Record journal entries in the order presented in the problem.$)$

Date

Account Titles and Explanation

Debit

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List of Accounts

Attempts: $0$ of $5$ used

$($b$).$

Repeat the requirements for $($a$),$ assuming that in addition to the assurance warranty, Pharoah sold Coronado an extended

warranty $($service$-$type warranty$)$ for an additional $2$ years $(2027-2028)$ for $$780.($Credit account titles are automatically indented

when the amount is entered. Do not indent manually. If no entry is required, select $"$No entry" for the account titles and enter $0$ for the

amounts. List all debit entries before credit entries. Record journal entries in the order presented in the problem.$)$

Date

Account Titles and Explanation

Debit