Platinum Corp

question 11

Multiple Choice

Platinum Corp. uses the expense approach to account for warranties. They sell a used car for $ 30,000 on Oct 25, 2020, with a one-year warranty covering parts and labour. Warranty expense is estimated at 2% of the selling price, and the appropriate adjusting entry is recorded at Dec 31, 2020. On March 12, 2021, the car is returned for warranty repairs. This cost Platinum $ 200 in parts and $ 120 in labour. When recording the March 12, 2021 transaction, Platinum would debit Warranty Expense with

• A) zero.
• B) $ 120.
• C) $ 200.
• D) $ 320.

---

Definitions:

Active Listening

The process of listening attentively while someone else speaks, paraphrasing and reflecting back what is said, and withholding judgment and advice.

Systematic Desensitization

A behavioral therapy technique used to reduce phobic responses and anxiety through gradual exposure to the feared object or situation combined with relaxation exercises.

Free Association

A psychoanalytic therapy technique in which a patient verbalizes thoughts as they come to mind, without censorship or filtering, to uncover subconscious feelings or desires.

Behavior Therapy

A form of psychotherapy that focuses on changing undesirable behaviors through conditioning techniques.