Wildhorse Company sells a machine for $8130 with a 12-month warranty agreement that requires the...
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Accounting
Wildhorse Company sells a machine for $8130 with a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customer. With sales being made evenly throughout the year the company sells 560 machines in 2020(warranty expense is incurred half in 2020 and half in 2021. As a result of product testing the company estimates that the warranty cost $498 per machine ($218 parts and $280labor). Use inventory account to record the warranty expense. Adsuming that actual warranty costs are incurred exactly as estimated what journal entries would be made relative to the following facts?
d. what amount if any is disclosed in the balance sheet as a liability for future warranty costs as of December 31, 2020?
warranty liability= $
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