Listed below are selected items from the financial statements of a company for the year ended December 31, Year 1.
|Current Maturity of Long-Term Debt||25,000|
|Bonds payable, due December 31, Year 20||2,200,000|
|Premium on Bonds Payable||14,000|
|Estimated Warranty Liability||10,000|
|Note Payable, due Dec. 31, Year 4||75,000|
|Note Payable, due June 1, Year 2||8,000|
|Discount on Note Payable due June 1, Year 2||500|
A company estimates the cost of products warranties to be 3% of sales. The beginning balance in Estimated Warranty Liability account is $15,000. Sales for the period was $795,000. During the period, $32,600 was actually paid for warranty related costs. What is the ending balance in the Warranty Liability account?
A company provides a warranty on its products that it sells to customers. The warranty liability account had $1,200 balance on April 1. The company had sales of $67,000 in April and estimated warranty repairs at 3% of sales. During the month, the company actually paid out $2,400 for warranty repairs.
Determine the April 30 balance in the estimated warranty liability account.