At the beginning of Year 1, McKee, Incorporated had a balance in the Warranty Payable account of $15,600. During the year McKee sold for $650,000 several products that carried a two-year warranty. McKee estimated that warranty expense would be 3% of sales for the year.
Required:
If McKee's paid warranty claims in the amount of $12,500 during Year 1, what is the balance in the Warranties Payable account after the warranty obligation is recognized?

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The Answer of At the beginning of Year 1, McKee, Incorporated had a balance in the Warranty Payable account of $15,600. During the year McKee sold for $650,000 several products that carried a two-year warranty. McKee estimated that warranty expense would be 3% of sales for the year.
Required:
If McKee's paid warranty claims in the amount of $12,500 during Year 1, what is the balance in the Warranties Payable account after the warranty obligation is recognized?

At the Beginning of Year 1, McKee, Incorporated Had a Balance