Treepop Computer sells 2,500 computers during 2021. Each computer is under 2-year warranty from the...
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Treepop Computer sells 2,500 computers during 2021. Each computer is under 2-year warranty from the date each computer is sold. Treepop estimates, based on past experience with similar computers, that the warranty cost will average $900 per computer. During 2021, the actual warranty cost is incurred $45,000. Treepop uses the accrual basis to record the cost related to the warranty.
What is the warranty expense presented in Income statement for the year ended 2021?
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