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 2013 warranty expense?

Name: 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 2013 warranty expense?
Brand: Quizplus
Rating: 4.8 (47 reviews)

Question

Quizplus · Accepted Answer

Warranty expense is 3% of revenues, or 0.03 * $90,000 = $2,700.

Ace Appliances Sells Dishwashers with a 3- Year Warranty