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Carter Appliance Center Sells Washing Machines That Carry a Three-Year

Question 28

Multiple Choice

Carter Appliance Center sells washing machines that carry a three-year warranty against manufacturer's defects.Based on company experience,warranty costs are estimated at $60 per machine.During the year,Carter sold 48,000 washing machines and paid warranty costs of $340,000.In its income statement for the year ended December 31,Carter should report warranty expense of


A) $680,000.
B) $960,000.
C) $2,200,000.
D) $2,880,000.

Correct Answer:

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