The Toro Company reported warranty liabilities of $96,604,000 in its October 31, 2019, balance sheet. On...

 

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The Toro Company reported warranty liabilities of $96,604,000 in its October 31, 2019, balance sheet. On its October 31, 2020, balance sheet, it reported a liability of $107,121,000. It recognized $77,758,000 in net warranty expenses during fiscal year 2020, ending October 31, 2020. a. What amount of cost did Toro incur to cover warranty claims in 2020? $ b. Record the entry described in part a in a journal entry. b. How would the fulfillment of these claims be recorded using the financial statement effects template? Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Transaction Payment to satisfy warranty claims. Balance Sheet Cash Asset Cash + N/A Noncash Assets 0 + Liabilities = Warranty liability Contrib. + Capital + 0 N/A N/A Earned Capital Income Statement 0 + N/A Revenues + 0 - N/A Expenses + 0 Net Income 0 The Toro Company reported warranty liabilities of $96,604,000 in its October 31, 2019, balance sheet. On its October 31, 2020, balance sheet, it reported a liability of $107,121,000. It recognized $77,758,000 in net warranty expenses during fiscal year 2020, ending October 31, 2020. a. What amount of cost did Toro incur to cover warranty claims in 2020? $ b. Record the entry described in part a in a journal entry. b. How would the fulfillment of these claims be recorded using the financial statement effects template? Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Transaction Payment to satisfy warranty claims. Balance Sheet Cash Asset Cash + N/A Noncash Assets 0 + Liabilities = Warranty liability Contrib. + Capital + 0 N/A N/A Earned Capital Income Statement 0 + N/A Revenues + 0 - N/A Expenses + 0 Net Income 0

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The task is to determine the cost that Toro incurred for warranty claims in 2020 To calculate the actual cost incurred we use the change in the warran... View the full answer