Multiple Atempts This test allows 2 attempts. This is attempt number 1 Force Com
ID: 2397154 • Letter: M
Question
Multiple Atempts This test allows 2 attempts. This is attempt number 1 Force Completion Once started,thistest must be completed in one silig Do noe thtbsking Seve and Subenit This test does not allow backtracking. Changes to the answer after Save and Submit Moving to the next question prevents changes to this answer Question7 points Save a one year warranty on the products it sells, They estimate that 20,000 of the 400,000 unts sold in 2000 wil e repairs and that these repairs will cost $8 per unit. The cost of repairing 16,000 units presented for service in 2020 was $128.000, Landitail should report O a warranty expense of $128,000 for 2020. b. warranty liability of S160000 on December 31, 2020. c warranty expense of $32,000 for 2020, d no warranty obligation on December 31. 2020, since this is only a contngent lability changes to this anscerExplanation / Answer
Answer is b. Warranty liability of $ 160000 on Dec 2020.
Explanation:
The total liability for year2020 is 20000 unts @$ 8 per unit: $ 160,000. The entry for the same shall be:
Warranty expense Account Dr. 160,000
Warranty expense payable Account 160,000
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