How much is the adjustment ending balance

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Starting 2019, every sale of the main product of Amongus Company will include a three-year warranty. It estimates warranty costs to be incurred at 1% of the sales price at the first year, 2% on the second year and 5% on the third year. Actual warranty expenditures were P37,100 and P72,600 during 2019 and 2020, respectively. Due to a fire incident, the sales journal of Amongus were burnt. It has been determined that the balance of the Estimated Warranty Liability is P309,500 on January 1, 2020 and P507,400 on December 31, 2020 before adjustments.

Problem 1: How much sales were made during 2019?

Problem 2: How much sales were made during 2020?

Problem 3: Assuming that the sales and warranty costs are made evenly, how much is the adjustment to the 2020 ending balance of the Estimate Warranty Liability? [Indicate whether it is a credit/debit adjustment]

Reference no: EM133000597

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