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Home Q & A Board Other Fields Homework Help Business Accounting
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H3Ko H3Ko
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7 years ago
Jumbo Sales Corporation offers warranties on all their electronic goods. Warranty expense is estimated at 3% of sales revenue. In 2017, the company had $602,000 of sales. In the same year, it paid out $12,000 of warranty payments. Which of the following is the entry needed to record the estimated warranty expense?

A) Warranty Expense   18,060   
     Estimated Warranty Payable      18,060

B) Warranty Expense   12,000   
     Estimated Warranty Payable      12,000

C) Estimated Warranty Payable   12,000   
     Cash      12,000

D) Warranty Expense   18,060   
     Sales Revenue      18,060
Textbook 
Horngren's Financial & Managerial Accounting, The Financial Chapters

Horngren's Financial & Managerial Accounting, The Financial Chapters


Edition: 5th
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TanksTanks
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7 years ago
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H3Ko Author
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#2
7 years ago
Really appreciate your help. Sorry for taking so long to thank you, you deserve the recognition.
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