The following information is available for Alvarez Co regarding the warranty Alvarez offers on the product...
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The following information is available for Alvarez Co regarding the warranty Alvarez offers on the product it sells. Warranty liability balance at 12/31/20 Units of product sold during 2021 Number of units that failed during 2021 and were returned by customers requesting replacement Cash refunds issued to customers during 2021 Estimate of units sold that will fail Cost per unit to refund purchase price to customers that purchused failed units $147,000 100,000 1.800 $109.800 3% $61 Explain what Alvarez's 2021 income statement should contain relating to warranties and what Alvarez's December 31. 2021 balance sheet should show regarding warranties. The following information is available for Alvarez Co regarding the warranty Alvarez offers on the product it sells. Warranty liability balance at 12/31/20 Units of product sold during 2021 Number of units that failed during 2021 and were returned by customers requesting replacement Cash refunds issued to customers during 2021 Estimate of units sold that will fail Cost per unit to refund purchase price to customers that purchused failed units $147,000 100,000 1.800 $109.800 3% $61 Explain what Alvarez's 2021 income statement should contain relating to warranties and what Alvarez's December 31. 2021 balance sheet should show regarding warranties.
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In the Year 2021 the total number of units sold is 100000 units and 3 is the fail unit percentage an... View the full answer
Related Book For
Accounting Principles
ISBN: 978-0470534793
10th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Posted Date:
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