Financial accounting Computer Wholesalers restores and resells notebook computer

Question

Financial accounting

Computer Wholesalers restores and resells notebook computers on eBay. It originally acquires the notebook computers from corporations upgrading their computer systems, and it backs each notebook it sells with a 90-day warranty against defects. Based on previous experience, Computer Wholesalers expects warranty costs to be approximately 6% of sales. By the end of the first year, sales and actual warranty expenditures are $600,000 and $23,000, respectively. I need journal entry and warranty liability

Explanation / Answer

# Particulars Debit Credit 1 Accounts receivable / cash $600000 Sales $600000 (For recording sale) 2 Warrant expense $36000 Accrued warrant liability $36000 3 Accrued warranty liability $23000 Cash $23000

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