Prepare the journal entries to create and close the warranty

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Reference no: EM13916865

Eric's Electronics sells computer parts. The company is required to warranty its products for 90 days. Historical Data indicates that 4% of monthly sales result in warranty claims.   The monthly sales for February were $567,550.

The following warranty claims were made against the February sales.

3/10 $75   

3/13 $145

3/15 $222   

3/18      $108

3/21 $119                  

3/24 $281                     

3/27 $101                        

3/29 $41

3/31 $588   

4/01 $66                      

4/04 $218                        

4/08      $951

4/15 $1040                    

4/17 $71                      

4/19 $822                         

4/23      $403

4/27 $52                      

4/28 $373

4/29 $169                        

5/02      $600

5/05 $2775                      

5/09        $313                         

5/12 $781                          

5/14      $385

5/16 $488                     

5/20     $1089                        

5/24 $966                       

5/26      $509               

5/28 $776                    

5/29 $182                       

5/30 $426                          

5/31      $600               

6/01 $1006                    

6/04 $2611                      

6/10 $490                        

6/15 $745               

6/20 $38                     

6/21 $1245                        

6/25 $949                         

6/27 $800   

6/28 $459                   

6/29 $530                        

6/30 $295                          

7/01   $1267               

Prepare the journal entries to create and close the warranty period for the contingent liability due to sales from February.

Post claims to the appropriate T-accounts to illustrate the journal entries.

Reference no: EM13916865

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