Sunnyvale Computer Company Sells a Line of Computers That Carry

question 140

Essay

Sunnyvale Computer Company sells a line of computers that carry a six-month warranty. Customers are offered the opportunity to buy a two-year extended warranty for an additional charge. During 2013, Sunnyvale received $320,000 from customers for these extended warranties. All sales are on credit, and funds are received evenly throughout the year and the warranties go into effect immediately after purchase.
Required:
Prepare a summary journal entry to record sales of the extended warranties. Also prepare any other entries associated with the warranties that should be recorded during 2013.

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Definitions:

Areas Of Expertise

Specific domains or fields where an individual or organization has extensive knowledge and skills.

Management Functions

The main tasks of managers, usually categorized into planning, organizing, leading, and controlling to achieve organizational goals.

Enthusiasm

A sense of lively enthusiasm for a specific subject or activity, accompanied by a keen desire to participate in it.

Resources Together

The act of pooling various types of resources such as financial, human, and material to achieve a common goal or project.