Early in 2017, Bramble Equipment Company sold 500 Rollomatics during 2017 at $6,

Question

Early in 2017, Bramble Equipment Company sold 500 Rollomatics during 2017 at $6,500 each. During 2017, Bramble spent $20,000 servicing the 2-year assurance warranties that accompany the Rollomatic. All applicable transactions are on a cash basis.

Date

Account Titles and Explanation

Debit

Credit

SHOW LIST OF ACCOUNTS

LINK TO TEXT

Date

Account Titles and Explanation

Debit

Credit

(To record warranty revenue)

Early in 2017, Bramble Equipment Company sold 500 Rollomatics during 2017 at $6,500 each. During 2017, Bramble spent $20,000 servicing the 2-year assurance warranties that accompany the Rollomatic. All applicable transactions are on a cash basis.

Explanation / Answer

1)

3250000

2)

**unearned warranty revenue is recognised on the basis of expense incurred out of total expense

Date Account title Debit credit During 2017 cash

3250000

sales revenue [500*6500] 3250000 During 2017 warranty expense 20000 cash 20000 dec 31 warranty expense 40000 estimated warranty liability [60000-20000] 40000

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.