Ninatori Fashion Supply Corp. issued checks totaling $53,200 to settle amounts d

Question

Ninatori Fashion Supply Corp. issued checks totaling $53,200 to settle amounts due to vendors on invoices (no early-payment discount terms offered). The board of directors of Ninatori Fashion Supply Corp. declared and immediately paid a $2.00 per share cash dividend for 2016. The Company had 1,000,000 shares outstanding throughout 2016. Ninatori Fashion Supply Corp. paid $4,800 cash to repair defective items covered by the Company's product warranty program. The cash paid to repair the items under the warranty program will decrease the Company's estimated warranty liability.

Explanation / Answer

Ninatori Fashion Supply Corporation All Amounts in $ Date Particulars Debit Credit 28-Dec Accounts Payable A/c 53200 To Bank A/c 53200 29-Dec Cash Dividend A/c 2000000 To Bank A/c 2000000 30-Dec Warranty Expenses A/c 4800 To Bank A/c 4800 Warranty Liability A/c 4800 To Warranty Expenses A/c 4800 31-Dec Utilities A/c 27600 To Provision for Expenses A/c 27600

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