Use the Following Information for Questions 40-42

question 26

Multiple Choice

Use the following information for questions 40-42.
Melman Microscopes Inc. offers a two-year warranty against failure of its products. The estimated liability is 1.5% in the year of sale and 3% in the second year. Sales and actual warranty expense for 2016 and 2017 were:
-The warranty liability on the December 31, 2017 balance sheet was

• A) $0.
• B) $28,000.
• C) $138,000.
• D) $175,500.

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Definitions:

Production Ban

A government or regulatory imposed prohibition on the manufacturing, sale, or distribution of certain products, typically for health, safety, or environmental reasons.

Murder Rate

A measure of the number of murders in a given area or population over a specific period of time, often per 100,000 individuals.

Bootleg Sellers

Individuals or entities that illegally sell unauthorized copies or versions of copyrighted products.

Government Price Control

Regulatory measures by government entities designed to set or limit the prices of certain goods and services.