On October 10,2013,Printfast Company sells a commercial printer for $2,350 with a one-year warranty that covers parts.Warranty expense is projected to be 4% of sales.On February 28,2014,the printer requires repairs.The cost of the parts for the repair is $80 and Printfast pays their technician $150 to perform the repair.
-What warranty expense is recorded for this printer during 2014?
A)$14.00.
B)$84.80.
C)$94.00.
D)$0,there is no expense in 2014.
E)$230.00.

Question

Quizplus · Accepted Answer

The warranty expense is recorded at the time of sale, not when the repair occurs. The expense was already estimated and recorded in 2013.

On October 10,2013,Printfast Company Sells a Commercial Printer for $2,350