Pharoah Company sold 10,100 Super-Spreaders on December 31, 2025, at a total price of $1,070,600, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $585,800. The assurance warranties extend for a 2-year period and are estimated to cost $36,600. Pharoah also sold extended warranties (service-type warranties) related to 2,000 spreaders for 2 years beyond the 2-year period for $12,000. Given this information, determine the amounts to report for the following at December 31, 2025: sales revenue, warranty expense, unearned warranty revenue, warranty liability, and cash. Amounts Reported in Income $ Amounts Reported on the Balance Sheet $
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- Blossom Company sold 10,500 heavy-duty spreaders on July 1, 2023, at a total price of $1,850,000, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $420,000. The assurance warranties extend for a two-year period and are estimated to cost $38,000. Blossom also sold extended warranties (service-type warranties) related to 1.500 spreaders for two years beyond the two-year period for $13,500. Prepare the journal entries that Blossom should make in 2023 related to the sale and the related warranties. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. List all debit entries before credit entries.) Date July 1, 2023 July 1, 2023 Account Titles and Explanation (To record cash sale) I (To record the cost of goods sold). Debit Credit 100 10Talarczyk Company sold 10,000 Super-Spreaders on December 31, 2020, at a total price of $1,000,000, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $550,000. The assurance warranties extend for a 2-year period and are estimated to cost $40,000. Talarczyk also sold extended warranties (service-type warranties) related to 2,000 spreaders for 2 years beyond the 2-year period for $12,000. Given this information, determine the amounts to report for the following at December 31, 2020: sales revenue, warranty expense, unearned warranty revenue, warranty liability, and cash.Skysong Factory provides a 2-year warranty with one of its products which was first sold in 2025. Skysong sold $997,500 of products subject to the warranty. Skysong expects $120,250 of warranty costs over the next 2 years. In that year, Skysong spent $71,080 servicing warranty claims. Prepare Skysong's journal entry to record the sales (ignore cost of goods sold) and the December 31 adjusting entry, assuming the expenditures are inventory costs. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.) Date During 2025 12/31/25 Account Titles and Explanation (To record payment for warranty costs incurred) (To record sales) Debit Credit 1
- Adams, Inc. sells widgets that come with an unconditional five-year warranty. According to Adams' best estimates, 7.8% of all units sold will require repair or replacement under that warranty, and the average cost of honoring one warranty claim is $60. During 2023, Adams' first year of operations, 176,000 widgets were sold, 1,278 of which were repaired or replaced under warranty claims. On its December 31, 2023 balance sheet, what amount of warranty liability will Adams report?On January 1, 2023, Sunland Ltd. sold on account 1,400 units of its product for a total price of $537,000 with a warranty guarant that the products were free of any defects. The products have a one-year assurance-type warranty and Sunland estimates that th cost will be $25,800. The cost of the units is $447,000. In addition, the company sold extended warranties related to 400 units for one-year period beyond the one-year assurance period at a cost of $15,200. By the company's year-end, December 31, 2023, no warranty costs were incurred. By the company's year-end, December 31, 2024, $9,545 of warranty costs were incurred and paid cash. Prepare the appropriate journal entries for 2023 and 2024.HELP ME
- Ace Appliances Inc. offers a 12-month warranty on all its appliances. AceAppliances estimates that one appliance out of each 1000 sold will require warranty service andthat the average cost per warranty claim is $300. Ace sold 30,000 appliances during 2020. Theestimated warranty liability at the beginning of the year was $ 4,500. Claims of $7,000 wereactually paid during the year to honour warranties. Ace Appliances has a December 31 year-end.Required:1. Calculate the estimated warranty expense for Ace Appliances for 2020.___________________2. Calculate the balance of the Estimated Warranty Liability account at December 31, 2020New Age Computers manufactures and sells pagers and radio paging systems which include a 180-day assurance warranty on product defects. The company estimates the value of the 180-day warranty to be $3,000. New Age also sells an extended warranty which provides an additional two years of protection. On May 10, the company sold a paging system for $4,500 with an extended warranty for another $1,400. The journal entry to record this transaction would be: OA. B. OD. Cash Sales revenue Unearned warranty revenue Cash Accounts receivable Sales revenue Service revenue Cash Sales revenue Cash Sales revenue Unearned warranty revenue Debit 5,900 Debit 4,500 1,400 Debit 8,900 Debit 8,900 Credit 4,500 1,400 Credit 4,500 1,400 Credit 8,900 Credit 7,500 1,400Techtronics, Inc. manufactures and sells stereo systems that include an assurance-type warranty for the first 90 days. Techtronics also offers an optional extended coverage plan under which it will repair or replace any defective part for 2 years beyond the expiration of the assurance-type warranty. The total transaction price for the sale of the stereo system and the extended warranty is $3,000. The standalone price of each is $2,300 and $900, respectively. The estimated cost of the assurance-warranty is $350. The accounting for warranty will include a A) debit to Warranty Expense, $900. B) debit to Warranty Liability, $350 C) credit to Warranty Liability, $900 D) credit to Unearned Warranty Revenue, $900
- On January 1, 2023, Sheridan Ltd. sold on account 800 units of its product for a total price of $549,000 and a cost of $477,000. The products have a one-year assurance-type warranty and Sheridan estimates that the cost will be $25,800. By the company's year-end December 31, 2023, actual warranty costs related to the products sold was $18,400, paid in cash. Prepare all appropriate journal entries including the sale of merchandise. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit CreditAce Appliances Inc. offers a 12-month warranty on all its appliances. AceAppliances estimates that one appliance out of each 1000 sold will require warranty service and that the average cost per warranty claim is $300. Ace sold 30,000 appliances during 2020. The estimated warranty liability at the beginning of the year was $ 4,500. Claims of $7,000 were actually paid during the year to honour warranties. Ace Appliances has a December 31 year-end. 1. Calculate the estimated warranty expense for Ace Appliances for 2020 2. Calculate the balance of the Estimated Warranty Liability account at December 31, 2020.Swifty's R Us sold 1130 high end convection ovens during 2023 at a price of $1650, with a warranty guarantee that the product was free from any defects. The cost of each oven is $1090 and includes a $10 one-year assurance warranty. In addition, Swifty's R Us sold extended warranties on 690 ovens for four years beyond the one-year period for $430 each. What is the total value of the liability related to the warranties? O $296700 O $0 O $308000 O $11300