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:

Comparison Group

In research, a group of subjects used as a benchmark to measure the effects or outcomes of a specific variable or intervention in another group.

Exposed

Revealed or disclosed, often something that was previously hidden or secret.

Similar Problem

A similar problem is an issue or challenge that shares characteristics or elements with another problem, allowing for the application of analogous solutions or strategies.

Social Problems

Issues that adversely affect an individual's quality of life in a society, often recognized collectively as conditions needing societal intervention or resolution.