What amount of warranty expense on income statement

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Question - Kohl Co. provides warranties for many of its products. The January 1, 2016, balance of the Estimated Warranty Liability account was $35,200. Based on an analysis of warranty claims during the past several years, this year's warranty provision was established at 0.4% of sales. During 2016, the actual cost of servicing products under warranty was $15,600, and sales were $3,600,000.

Required:

a. What amount of Warranty Expense will appear on Kohl Co.'s income statement for the year ended December 31, 2016?

b. What amount will be reported in the Estimated Warranty Liability account on the December 31, 2016, balance sheet?

Reference no: EM131722198

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