Claudette, Inc

question 19

Essay

Claudette, Inc., provides warranties for many of its products. The January 1, 2017, balance of the Estimated Warranty Liability account was $77,000. Based on an analysis of warranty claims during the past several years, this year's warranty provision was estimated to be 0.8 percent of sales. During 2017, the actual costs of servicing products under warranty were $102,000, and sales were $10,600,000.(a.) What amount of Warranty Expense will appear on the income statement for 2017?
(b.) What amount will be reported in the Estimated Warranty Liability account on the December 31, 2017, balance sheet?

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Definitions:

Primacy

The tendency to remember and give more importance to the first information we encounter about something, over data that comes later.

Parental Effect

The influence that parents have on the development, behavior, and personality of their children.

Formative Period

A critical phase in development or history where foundational growth, organization, or change takes place.

Personality Development

The growth and change of an individual’s characteristics and behaviors over time, influenced by genetics, environment, and experiences.