Hadley Industries warrants its products for one year. The estimated product warr
ID: 2568854 • Letter: H
Question
Hadley Industries warrants its products for one year. The estimated product warranty expense is 4% of sales. Assume that sales were $210,000 for June. In July, a customer received warranty repairs requiring $205 of parts and $75 of labor.
Required:
*Refer to the Chart of Accounts for exact wording of account titles. Please list the correct dates on your journal.* This journal should have 3 rows.
Chart of Accounts...
(a) Journalize the adjusting entry required at June 30, the end of the first month of the current year, to record the estimated product warranty expense.* Please list the correct dates on your journal.* This journal should contain 2 rows. (b) Journalize the entry to record the warranty work provided in July.**Refer to the Chart of Accounts for exact wording of account titles. Please list the correct dates on your journal.* This journal should have 3 rows.
Chart of Accounts...
ASSETS 110 Cash 111 Accounts Receivable 112 Interest Receivable 113 Notes Receivable 115 Inventory 116 Supplies 118 Prepaid Insurance 120 Land 123 Building 124 Accumulated Depreciation-Building 125 Office Equipment 126 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 213 Interest Payable 214 Notes Payable 221 Wages Payable 222 Social Security Tax Payable 223 Medicare Tax Payable 224 Federal Withholding Tax Payable 225 State Withholding Tax Payable 226 Federal Unemployment Tax Payable 227 State Unemployment Tax Payable 228 State Disability Insurance 231 Medical Insurance Payable 232 Retirement Savings Deductions Payable 233 Union Dues Payable 234 Vacation Pay Payable 235 Unfunded Pension Liability 241 Product Warranty Payable 242 EPA Fines Payable 243 Litigation Claims Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends 313 Income Summary REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 520 Salaries Expense 525 Delivery Expense 526 Repairs Expense 531 Rent Expense 533 Insurance Expense 534 Supplies Expense 535 Cash Short and Over 536 Product Warranty Expense 541 Vacation Pay Expense 542 Pension Expense 543 Payroll Tax Expense 544 Federal Income Tax Expense 545 State Income Tax Expense 561 Depreciation Expense-Building 562 Depreciation Expense-Office Equipment 570 Damage Awards and Fines 590 Miscellaneous Expense 710 Interest ExpenseExplanation / Answer
Dear Student Thank you for using Chegg Please find below the answer and please give thumbs up Statementshowing Computations Paticulars Dr CR a) Product Warranty expense Dr 8,400.00 To product warranty payable 8,400.00 (210,000*4%) b) Product warranty payable dr 280.00 To Supplies 205.00 To Wages payable 75.00
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