Exercise 13-11 Early in 2017, Flounder Equipment Company sold 400 Rollomatics du

Question

Exercise 13-11 Early in 2017, Flounder Equipment Company sold 400 Rollomatics during 2017 at $6,000 each. During 2017, Flounder spent $20,000 servicing the 2-year assurance warranties that accompany the Rollomatic. All applicable transactions are on a cash basis. Prepare 2017 entries for Flounder. Assume that Flounder estimates the total cost of servicing the warranties will be $57,000 for 2 years. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT VIDEO: SIMILAR EXERCISE

Explanation / Answer

Cash 2400000 =400*6000      Sales revenue 2400000 Warranty Expense 20000        Cash 20000 Warranty Expense 37000       Warranty Liability 37000

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