The accounting records of Harroy Industries included the following at January 1, 2014: In the past, Harroy

Question:

The accounting records of Harroy Industries included the following at January 1, 2014:

In the past, Harroy Industries' warranty expense has been 3 percent of sales. During 2014, Harroy Industries made sales of $1,038,000 and paid $27,900 to satisfy warranty claims.
Required
1. Record Harroy Industries' warranty expense and warranty payments during 2014. Explanations are not required.
2. What balance of Estimated Warranty Payable will Harroy Industries report on its balance sheet at December 31, 2014?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...