Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. appliance plus sold four-year extended warranties

Appliance Plus sold four-year extended warranties on 600 refrigerators in 2023 for a total of...

70.2K

Verified Solution

Question

Accounting

Appliance Plus sold four-year extended warranties on 600 refrigerators in 2023 for a total of
$210,000. The cash received for these sales was properly recorded to Unearned Revenue. How will the company record the recognition of revenue over the next four years.
a. Show the amount of revenue to be recognized from unearned revenue assuming management believes that the service warranty will be used up evenly over the four years.
b.Show the amount of revenue to be recognized from unearned revenue assuming management believes that 10% will be used fully in the 1st year, 20% in the 2nd year, 35% in the 3rd year, and the remaining 35% in the 4th year.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students