1. Business
  2. Accounting
  3. a company provides three year warranty with their products they...

Question: a company provides three year warranty with their products they...

Question details

a company provides three year warranty with their products. they expect to replace one of every ten products sold under this warranty.

in 2018, they sold 1,000 products for $500 and they spend 13,200 on replacing the "damaged" products. the cost to replace a product is 400 (COGS) .

prepare all journal entries during 2018 for the sale and related warranty expense (assume that 2018 was the first year that the products were sold)

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution