A Company Sells Personal Computers for $2,300 Each

question 135

Essay

A company sells personal computers for $2,300 each. The price includes a two-year warranty. During the current year, the company sells 400 computers. On the basis of past experience, the warranty costs are estimated to be $250 per computer. The actual warranty costs (paid in cash) by the company during the current year were $65,000. Prepare general journal entries to record the (a) estimated warranty expense and (b) warranty repair costs during current year.

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Definitions:

Fight-Or-Flight Response

A physiological reaction that occurs in response to a perceived harmful event, attack, or threat to survival, triggering either aggression or escape.

Physiological Reactions

Body responses to stimuli or environmental changes, including hormonal, neural, and biochemical processes.

Dilated Pupils

Condition in which the pupils of the eye become larger or wider than normal, often as a response to low light or certain emotions.

General Adaptation Syndrome

A three-stage theory proposed by Hans Selye describing the physiological changes the body goes through in response to long-term stress.