ACCTG415 Study Guide - Quiz Guide: Amortization Schedule
8 Apr 2014
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This quiz consists of 2 questions on pages 2 to 5. On january 1, 2014, the company sold 3,000 units for ,200 per unit. The company provides a 2-year parts-and-labor warranty on each unit sold. The estimated cost of each warranty is whereas a comparable 2-year warranty can be purchased from a third party for . Gibbins company expects that 70% of warranty claims will be made in the first year and the remaining 30% in the second year. In 2014, gibbins company incurred actual warranty costs of ,000 for the units sold on january 1, 2014: ,000 for parts and ,000 for labor. In 2015, the company incurred additional actual warranty costs for these units of ,000: ,000 for parts and ,000 for labor. The company"s fiscal year ends on december 31. Required: (note that the required includes parts a and b below. )
