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Problem - Jane Company extends a warranty on children's tablets. They estimate that 3% of tablets will need to be replaced. The sales price of one tablet is $100 and the cost is $50. Total tablet sales were 10,000 tablets for $1,000,000 in 2020. On February 14, 2021, Jane company replaced 30 tablets under warranty.
Required -
1. Prepare the necessary adjusting entry on December 31, 2020?
2. Prepare the necessary journal entry on February 14, 2021?
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