Answer:
$16,925,000
Explanation:
The company estimates that the warranty cost is $310 per units sold
The estimated warranty costs at the beginning of the year is $10,600,000
In the current year, the company sold 59,500 units
The company paid warranty claims of $12120000
Therefore, the amount of liability that should be reported at the end of the current year can be calculated as follows
= 10,600,000+(59,500×310)-$12,120,000
= $10,600,000+18,445,000 -$12,120,000
= $29,045,000-$12,120,000
= $16,925,000
Hence the amount of liability that should be reported on the balance sheet at the end of the current year is $16,925,000
