In 2017, Scranton, Inc. sold 2,000 carpets for $50 each. The carpets carry a two-year warranty...
In 2017, Scranton, Inc. sold 2,000 carpets for $50 each. The carpets carry a two-year warranty for repairs. Scranton estimates that repair costs will average 3% of the total selling price. What amount would be recorded in the warranty liability account as a result of selling the carpets during 2017?
a.$1,500
b.$50
c.$3,000
d.No liability should be recorded until the carpets are returned for repairs.
Homework Answers
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Amount to be recorded in warranty liability account = (2000*50) * 3% = 3,000 Option C is the answer |
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