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Exercise 8-14A Record warranties (LO8-5)

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Computer Wholesalers restores and resells notebook computers. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 6% of sales. Sales for the month of December are $470,000. Actual warranty expenditures in January of the following year were $16,500.

Exercise 8-14A Part 4

4. What is the balance in the Warranty Liability account after the entries in Part 2 and 3?