Video-Technical, Inc. was organized to sell a single product for $600 per unit, including a 60-day warranty against defects. Engineering estimates indicate that 5% of the units sold will prove defective and require an average repair cost of $50 per unit. During September, total sales were $198,000; 9 units sold during September were found defective and repaired.
The accrued liability for product warranties at month-end should be:

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The Answer of Video-Technical, Inc. was organized to sell a single product for $600 per unit, including a 60-day warranty against defects. Engineering estimates indicate that 5% of the units sold will prove defective and require an average repair cost of $50 per unit. During September, total sales were $198,000; 9 units sold during September were found defective and repaired.
The accrued liability for product warranties at month-end should be: