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Mandarinka [93]
3 years ago
7

Dynamo Corporation manufactures toasters. Each toaster comes with a 5-year assurance-type warranty. The toasters sell for $50 ea

ch. During Year 1, Dynamo sells 500 toasters, for cash. Past experience shows that the average warranty costs are $5 each or $2,500 for these toasters. In Year 1, Dynamo pays $500 cash for warranty costs on the toasters sold that year.
Required:
Prepare Dynamo's journal entries related to the sales and warranty in Year 1.
Business
1 answer:
Leno4ka [110]3 years ago
7 0

Answer:

1.Dr Cash 25,000

Cr Sales revenue 25,000

2. Dr Warranty expense 2,500

Cr Warranty liability 2,500

3.Journal entry for actual warranty expense

Dr Warranty liability 500

Cr Cash 500

Explanation:

Preparation of Dynamo's journal entries related to the sales and warranty in Year 1.

1.Dr Cash 25,000

Cr Sales revenue 25,000

(50*500)

2. Dr Warranty expense 2,500

Cr Warranty liability 2,500

3. Dr Warranty liability 500

Cr Cash 500

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Answer:

a. Decrease liabilities and decrease assets

Explanation:

First option "Decrease liabilities and decrease assets" is the correct option as far as only payment part of Journal entry is concerned.

Since Dividend is declared on 15 July on That date entry would have been:

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Answer:

The answer is true.

Explanation:

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According to the​ "rule of​ 70", how many years will it take for real gdp per capita to double when the growth rate of real gdp
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A registered investment adviser often recommends real estate limited partnership investments to her wealthy clients. The RIA's p
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