Solution-Calculate the balance of the account as of the end

Calculate the balance of the account as of the end

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Reference no: EM132865751

Problem - Beck Company sells a product for $3,200. When the customer buys it, Beck provides a one-year warranty. Beck sold 120 products during 2016. Based on analysis of past warranty records, Beck estimates that repairs will average 4% of total sales.

Required -

1. Prepare the journal entry to record the estimated liability.

2. Assume that during 2016, products under warranty must be repaired using repair parts from inventory costing $10,200. Prepare the journal entry to record the repair of products.

3. Assume that the balance of the Estimated Liability for Warranties account as of the beginning of 2016 was $1,100. Calculate the balance of the account as of the end of 2016.

Reference no: EM132865751

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Calculate the balance of the account as of the end

Reference no: EM132865751

Reference no: EM132865751

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