What amounts should be recognised in the financial statements of Punt Co relating to the warranty...

  

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What amounts should be recognised in the financial statements of Punt Co relating to the warranty provision for the year to 20X3? Martinez Co sells computers with a warranty. Customers are covered for the cost of repairs of any manufacturing defect that becomes apparent within the first year of purchase. The company's past experience and future expectations indicate the following pattern of likely repairs. % of goods sold Defects 70 20 10 None Minor Major The warranty provision brought forward is $80,550. SPL - $ 80550 Cr; SOFP - Nil SPL - $ 80550 Dr; SOFP - Nil SPL - $69450 Dr; SOFP - $150000 Cr SPL - $69450 Cr SOFP-$150000 Cr Cost of repairs $'000 450 600 What amounts should be recognised in the financial statements of Punt Co relating to the warranty provision for the year to 20X3? Martinez Co sells computers with a warranty. Customers are covered for the cost of repairs of any manufacturing defect that becomes apparent within the first year of purchase. The company's past experience and future expectations indicate the following pattern of likely repairs. % of goods sold Defects 70 20 10 None Minor Major The warranty provision brought forward is $80,550. SPL - $ 80550 Cr; SOFP - Nil SPL - $ 80550 Dr; SOFP - Nil SPL - $69450 Dr; SOFP - $150000 Cr SPL - $69450 Cr SOFP-$150000 Cr Cost of repairs $'000 450 600

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The answer is SPL69450 ... View the full answer