How much in estimated warranty payable does company owe

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Reference no: EM133609857

Question: Wet Rides guarantees its SeaDoos for three years. Company experience indicates that warranty costs will be approximately 4% of sales. Assume that the Wet Rides dealer in Burlington made sales totaling $335,000 during 2020. The company received cash for 22% of the sales and notes receivable for the remainder. Warranty payments totaled $8,000 during 2020. 1. Record the sales, warranty expense, and warranty payments for the company. Ignore cost of goods sold. 2. Post to the Estimated Warranty Payable T account. At the end of 2020, how much in Estimated Warranty Payable does the company owe? Assume the Estimated Warranty Payable is $0 on January 1, 2020.

Reference no: EM133609857

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