User Account

All Pages

Prepare the summary journal entry

Assignment Help Accounting Basics
Reference no: EM132833703

Question - Recall that Cookie Creations sells fine European mixers that it purchases from Kzinski Supply Company. Kzinski warrants the mixers to be free of defects in material and workmanship for 1 year from the date of original purchase. If the mixer has such a defect, Kzinski will repair or replace the mixer free of charge for parts and labor. The product must be shipped prepaid to an authorized Kzinski service center. The consumer pays the cost to ship the mixer. The cost to return the product to the consumer is paid by Kzinski.

The authorized service center is located in Boston. Because Cookie Creations values serving its customers, it pays the shipping to Boston for any mixers needing repair under Kzinski's warranty terms. Based on past experience, Kzinski has found that approximately 10% of mixers are returned for repair or replacement. The average cost to ship a mixer to Boston is $60.

The following transactions take place in 2020 and 2021.

1. A total of 30 mixers are sold in 2020.

2. Four of the mixers sold in 2020 are returned for repair in 2021. The total shipping cost for returning these four mixers to Boston is $210.

3. A total of 40 mixers are sold in 2021.

4. Two of the mixers sold in 2021 are returned for repair in 2021. The total shipping cost for returning these two mixers to Boston is $55.

Required - Complete the tasks listed below using Excel.

1. Calculate Cookie Creations' warranty liability for the shipping costs at December 31, 2020.

2. Record the estimated warranty liability at December 31, 2020.

3. Prepare the summary journal entry (or entries) to record the shipment of the six mixers (four from the 2020 sales and two from the 2021 sales) for warranty repair in 2021.

4. Calculate Cookie Creations' warranty liability at December 31, 2021.

5. Record the estimated warranty liability at December 31, 2021.

Reference no: EM132833703

Questions Cloud

Explain the concept of asset impairment : Explain the concept of asset impairment. Briefly describe what types of assets are subject to the testing and calculation of impairment losses
Determine the basis of the property contributed in the hands : Determine the basis of the property contributed in the hands of the corporation in each instance. Assume that the 80% rule is met in all cases.
Discussion on transformational leadership : This week's journal articles focus on transformational leadership and knowledge and knowledge sharing within an organization, please review these concepts.
How will the partnership depreciate the equipment in year : How will the partnership depreciate the equipment in the year of contribution? What is the basis of the equipment in the hands of the partnership?
Prepare the summary journal entry : Prepare the summary journal entry (or entries) to record the shipment of the six mixers (four from the 2020 sales and two from the 2021 sales)
Examples current events in the world : What are examples current events in the world that revolve around the category of Planning, Controlling and Organizing?
Do think a partnership that is teo family members : Do you think a partnership that is 2 family members or 2 friends more likely to survive than a partnership with 2 strangers that came together?
Determine the pinacle plantwide factory overhead rate : Pinacle Corp. budgeted $271,750 of overhead cost for the current year. Determine the Pinacle plantwide factory overhead rate
Identify the it general control risks evident from the case : Identify the IT general control risks evident from the case. For each risk identified, identifiy possible controls to mitigate those risks and explain.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Producers focus less on quarterly earnings per share and tax

The chairman of the FASB at one time noted that "the flow of standards can only be slowed.

  It is the first year of operations at johnnys subs and the

it is the first year of operations at johnnys subs and the cost of all work in process during the year is 830000.

  Compute the return on stockholders equity

Southvrest Airlines Co. (LUV) reported the following data (in millions) for a recent year: Compute the return on stockholders equity

  Prepare a business valuation using an earnings model

Earnings valuation models. Bayview Real Estate Development is a company that owns and operates a number of real estate ventures.

  Prepare the adjusting entries on january 31 account titles

prepare the adjusting entries on january 31. account titles are accumulated depreciationu2014 equipment depreciation

  Journal entries on books of jayhawk carpet company

Prepare the necessary journal entries on the books of Jayhawk Carpet Company to record the following transactions, assuming a perpetual inventory system (you may omit explanations):

  What was kidsplay operating income

What was KidsPlay's operating income in 2016? What was the full cost per unit? What was the selling price? What was the percentage markup on variable cost.

  Show the income statement effects of these transactions

On July 1, 2017, Indigo assigned $696,000 of accounts receivable, Show the income statement effects of these transactions for the year ended December 31, 2017

  At a recent meeting of the stockholders

At a recent meeting of the stockholders, Harper's president stated 2015 would be a very good year with net income rising significantly.

  What amount of this debt should be eliminated

Kordel Inc. holds 75% of the outstanding common stock of Raxston Corp. Raxston currently owes Kordel $500,000 for inventory acquired over the past few months. In preparing consolidated financial statements, what amount of this debt should be elimi..

  What would you recommend to management to minimize impact

As the chief accounting officer of a company with foreign operations, what would you recommend to management to minimize the impact of foreign currency fluctuat

  What is the taxable income

Please allocate the costs and advise, what is the taxable income for year 1 and 2, noting there are no other expenses outside the allocation of costs

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd