Total cost of servicing the warranties

Assignment Help Accounting Basics
Reference no: EM13761251

During 2007, Crow spent $20,000 servicing the 2-year warranties that accompany the Rollomatic. All applicable transactions are on a cash basis.

Instructions

(a) Prepare 2007 entries for Crow using the expense warranty approach. Assume that Crow estimates the total cost of servicing the warranties will be $120,000 for 2 years.

(b) Prepare 2007 entries for Crow assuming that the warranties are not an integral part of the sale. Assume that of the sales total, $150,000 relates to sales of warranty contracts. Crow estimates the total cost of servicing the warranties will be $120,000 for 2 years. Estimate revenues earned on the basis of costs incurred and estimated costs.

Reference no: EM13761251

Questions Cloud

Production run length for optimal production run quantity : Product X is a standard item in a firm’s inventory. Final assembly of the product is performed on an assembly line that is in operation every day. One component of product X (call it component A) is produced in another department. This department, wh..
Define transferring data from any core to any other core : Explain why loose timings on RAM memory might be useful in a multicore environment. If you know how to do a timing diagram that could be useful but you can also explain the concept. Assume that transferring data from any core to any other core c..
Summarize the influences of diversity within a workplace : Summarize the influences of diversity within a workplace
Minimize the risk of material misstatement : According to the text, to minimize the risk of material misstatement, auditors seek third- party verification of account balances by mailing customers their statements. Discuss the advantages of positive and negative confirmations, and ascertain w..
Total cost of servicing the warranties : (a) Prepare 2007 entries for Crow using the expense warranty approach. Assume that Crow estimates the total cost of servicing the warranties will be $120,000 for 2 years.
Corruption perceptions index is a comparative assessment : The corruption perceptions index (CPI) is a comparative assessment of integrity performance for a variety of countries. What is CPI? What is its purpose? What is the value of this index? What are the trends or similarities between countries with the ..
Academic health centers : Academic health centers are defined as "teaching hospitals . . . medical and nursing schools, clinics, emergency departments, freestanding outpatient care centers, hospices, and individual and group practices staffed by a mix of senior physicians and..
Entry to record the partial refunding : Make the entry to record the partial refunding. Assume Jenks Co. makes reversing entries when appropriate  Prepare the adjusting entry at December 31, assuming straight-line amortization of the discount.
Strategic alternatives : Consider strategic alternatives for the organization you selected for the Unit 1 assignment. The Organization selected is Nursing Homes. Why does the selection of strategic alternatives create direction for your selected organization?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Why do firms want to hold inventory of finished goods an

question 1. production budget the following table presents generic motors companys production budget. gms inventory

  Negotiating first nfl contract

PV of a cash flow stream A rookie quarterback is negotiating his first NFL contract. His opportunity cost is 10 percent. He has been offered three possible 4-year contracts. Payments are guaranteed, and they would be made at the end of each year.

  Acceptance the asset

which of the following is not an indicator that the customer is likely to have control over a good? a)acceptance the asset B) assets warehouse by seller-affiliated thrird party c) legal litle to the asset

  Ts bakery makes a variety of cakes cookies and pics for

toms bakery makes a variety of cakes cookies and pics for distribuition to five major chains of grocery stores in the

  Singular methodology for project management

What obstacles exist in getting marketing and engineering to agree to a singular methodology for project management? What might happen if benchmarking studies indicate that either marketing or engineering are at fault?

  Ending inventory in a retail establishment

Carson Inc., a retail establishment, expects sales of $500,000 of a particular item in March. Its gross profit percentage is 60 percent.

  Sunny hazel the manager of cyber web services must decide

sunny hazel the manager of cyber web services must decide whether to hire a new employee or to outsource some of the

  Statement of financial position presentation for each bond

Mclain corporation sold 6.000.000, 9%, 10years bonds on january 1, 2014. the bonds were dated january 1, 2014, and pay interest on july 1 and january 1. McLain corporation use the straight line method to amortize bond premium or discount. assume no i..

  31 the petty cash fund has 29 in cash and 284 in petty cash

the following petty cash transactions of lexite laminated surfaces occurred in augustaug 1 established a petty cash

  Weighted-average contribution margin ratio

Fields Corporation has two divisions; Sporting Goods and Sports Gear. The sales mix is 65% for Sporting Goods and 35% for Sports Gear. Fields incurs $2,220,000 in fixed costs. The contribution margin ratio for Sporting Goods is 30%, while for Spor..

  What is the breakeven point if tax reduced

What is the breakeven point if Mount Carmel's tax rate is reduced to 25%, assuming the sales mix is 2 units of Product A for each unit of Product B?

  Maximum amount of short term commercial loan

What is the maximum amount of short term commercial loan that can be obtained by the firm to finance inventory expansion without violating its current policy?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd