Franconia Sales offers warranties on all their electronic goods. Warranty expense is estimated at 2% of sales revenue. In 2014, Franconia had $500,000 of sales. In the same year, Franconia paid out $7,500 of warranty payments. Please provide the journal entry to record the warranty expense.
Definitions:
Negative Beta
A measure indicating that an investment's returns are expected to move in the opposite direction of the overall market returns.
Treasury Bills
Short-term government securities with maturity periods typically less than one year, considered low-risk investments.
Long Bonds
Bonds with maturities typically longer than 10 years, often used to lock in interest rates.
Variance
A statistical measure that captures the dispersion of a set of data points around their mean, indicating how spread out the data is.
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