Aqua Construction installs swimming pools. It calculates that warranty obligations are 5% of sales. For the year just ending, Aqua's sales were $1,500,000. Previous quarterly entries debiting Warranty Expense totaled $48,700. Determine the estimated warranty expense for the year and make the journal entry necessary to bring the account to the needed balance.

Question

Quizplus · Accepted Answer

The Answer of Aqua Construction installs swimming pools. It calculates that warranty obligations are 5% of sales. For the year just ending, Aqua's sales were $1,500,000. Previous quarterly entries debiting Warranty Expense totaled $48,700. Determine the estimated warranty expense for the year and make the journal entry necessary to bring the account to the needed balance.

Aqua Construction Installs Swimming Pools