How much warranty expense is reported for November

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Reference no: EM132805981

Problem - On October 29, Lobo Co. began operations by purchasing razors for resale. The razors have a 90-day warranty. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $16 and its retail selling price is $80. The company expects warranty costs to equal 6% of dollar sales. The following transactions occurred.

Nov. 11 Sold 70 razors for $5,600 cash.

Nov. 30 Recognized warranty expense related to November sales with an adjusting entry.

Dec. 9 Replaced 14 razors that were returned under the warranty.

Dec. 16 Sold 210 razors for $16,800 cash.

Dec. 29 Replaced 28 razors that were returned under the warranty.

Dec. 31 Recognized warranty expense related to December sales with an adjusting entry.

Jan. 5 Sold 149 razors for $11,200 cash.

Jan. 17 Replaced 33 razors that were returned under the warranty.

Jan. 31 Recognized warranty expense related to January sales with an adjusting entry.

Required - How much warranty expense is reported for November and December?

Reference no: EM132805981

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