Reference no: EM132948885
During 2021, WallaWalla Co. introduced a new line of machines that carry a three-uear warranty against manufacturer's defects. Based on industry experience, warranty costs are estimated to occur over three years and are estimated to be 2% of sales in the year of sale, 3% in the year after sale, and 4% in the second year after sale.
Sales and actual warranty expenditures paid for the first three-year period were as follows:
Sales Actual Warranty Expenses Paid
2021 $600,000 $9,000
2022. $1,400,000 $65,000
2023 $2,100,00 $135,000
$4,200,000 $209,000
Question 1: What is the warranty expense in 2022?
Question 2: What amount is the warranty liability at December 31, 2023?
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