A company provides a warranty on its products that it sells to customers. The warranty liability account had $1,200 balance on April 1. The company had sales of $67,000 in April and estimated warranty repairs at 3% of sales. During the month, the company actually paid out $2,400 for warranty repairs.
Determine the April 30 balance in the estimated warranty liability account.
4. Contingent Liabilities 6. The Effect of Uncollectible Accounts| Click Here to View All Chapter 8 Problems at Once | View | ||
| 1 | Liability Classification | Easy | |
| 2 | The Effect of Bad Debt Expense | Easy | |
| 3 | Calculating Bad Debts | Moderate | |
| 4 | Contingent Liabilities | Moderate | |
| 5 |
Contingent Liabilities - Warranties
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Moderate | |
| 6 | The Effect of Uncollectible Accounts | Moderate | |
| 7 | Using the Balance Sheet Method | Hard |
| 1 | A/R and Bad Debts Introduction | 7:09 | |
| 2 | Direct Method | 4:15 | |
| 3 | The Allowance Method | 8:56 | |
| 4 | Income Statement vs Balance Sheet Methods | 13:14 | |
| 5 | Net Credit Sales | 5:20 | |
| 6 | Write Offs and Reinstatements | 8:26 | |
| 7 | Notes Receivable | 11:27 | |
| 8 | Interest Bearing Notes | 8:26 | |
| 9 | Non-interest Bearing Notes | 6:16 | |
| 10 | Contingencies | 5:58 |