Amazon sells copiers that come with a 2-year warranty contract that requires them to fix...
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Accounting
Amazon sells copiers that come with a 2-year warranty contract that requires them to fix any defects during the warranty period. During 2018, Amazon sells 600 copiers for $4,000 each. During 2018, Amazon spent $30,000 servicing these warranties. During 2019, Amazon spent $100,000 servicing these warranties.
a) Record any necessary journal entries related to the sale of the copiers and the warranties for both 2018 and 2019. Amazon estimates that the total cost of the 2-year warranties will be $150,000.
b) How would the liability related to these warranties be presented on the 2018 balance sheet?
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