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gOOvER gOOvER
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7 years ago
Franconia Sales offers warranties on all their electronic goods.  Warranty expense is estimated at 2% of sales revenue.  In 2013, Franconia had $500,000 of sales.  In the same year, Franconia paid out $7,500 of warranty payments.  Which of the following is the entry needed to record the estimated warranty expense?
A)
Estimated warranty payable   7,500   
       Cash      7,500

B)
Warranty expense   7,500   
       Estimated warranty payable      7,500

C)
Warranty expense   10,000   
       Estimated warranty payable      10,000

D)
Warranty expense   10,000   
       Sales revenue      10,000
Textbook 
Accounting, Volume 1, Canadian Edition

Accounting, Volume 1, Canadian Edition


Edition: 9th
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KryzenKryzen
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7 years ago
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