Bach. Co. presents the following information for 2018 and 2019.

2018 information:
Sales on account in the amount of $645,000
Warranty expense and associated liability in the amount of $125,000
No other expenses incurred.

2019 information:
Sales on account in the amount of $225,000
Warranty payments made in the amount of $65,000
No expenses incurred.

Prepare the journal entries for 2018 and 2019 to record the sales, warranty, and income tax transactions, assume a 40% tax rate.

Question

Bach. Co. presents the following information for 2018 and 2019.

2018 information:
Sales on account in the amount of $645,000
Warranty expense and associated liability in the amount of $125,000
No other expenses incurred.

2019 information:
Sales on account in the amount of $225,000
Warranty payments made in the amount of $65,000
No expenses incurred.

Prepare the journal entries for 2018 and 2019 to record the sales, warranty, and income tax transactions, assume a 40% tax rate.

Quizplus · Accepted Answer

The Answer of Bach. Co. presents the following information for 2018 and 2019.

2018 information:
Sales on account in the amount of $645,000
Warranty expense and associated liability in the amount of $125,000
No other expenses incurred.

2019 information:
Sales on account in the amount of $225,000
Warranty payments made in the amount of $65,000
No expenses incurred.

Prepare the journal entries for 2018 and 2019 to record the sales, warranty, and income tax transactions, assume a 40% tax rate.

Bach Co Presents the Following Information for 2018 and 2019