The Following Information Is Available for a Retail Store for the Month

question 93

Essay

The following information is available for a retail store for the month of February:
1.Wahlberg Computers sells computers for $2,500 each on account.On February 1,Wahlberg sold 20 computers.The cost of each computer sold was $1,000.The store uses the perpetual inventory system.
2.It is estimated that the warranty expense is 5% of gross sales.A journal entry is prepared February 1.
3.During February,Wahlberg replaced two computers due to product warranty complaints for products purchased in a prior month.
4.A customer fell in the store and is seeking $100,000 in damages.Wahlberg's attorney believes the case is frivolous because the customer has similar lawsuits pending against other retail stores.
5.A customer is suing Wahlberg Computers for $100,000 because the customer's computer purchased from Wahlberg Computers started a fire and destroyed the customer's residence.Wahlberg's attorney believes the customer will probably win the case and receive $100,000.
Required: Prepare the journal entries to record the transactions above.Omit explanations.

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Definitions:

Industry Versus Inferiority

A stage in Erik Erikson's theory of psychosocial development where children, typically between ages 6 and 11, develop a sense of competence or inferiority based on their abilities to master skills and tasks.

Psychosocial Development

A theory proposed by Erik Erikson that describes how individuals evolve through and navigate various social and emotional stages throughout their lives.

Sense Of Industry

A stage in psychological development where an individual develops a sense of competence and achievement, usually occurring during childhood.

Praise And Support

Acts of expressing approval or admiration combined with assistance and encouragement.