Ace Appliances sells dishwashers with a 3- year warranty. In 2013, there are $90 000 of sales revenues for dishwashers. The company estimates warranty expense at 3% of revenues. What is the total estimated warranty payable for Ace regarding the sales in 2013?

Question

Quizplus · Accepted Answer

The total estimated warranty payable is calculated as 3% of the sales revenues. Therefore, $90,000 * 0.03 = $2,700.

Ace Appliances Sells Dishwashers with a 3- Year Warranty