Farr Co. elects to use the percentage-of-sales basis in 2017 to record bad debt expense. It estimates that 2% of net credit sales will become uncollectible. Salas revenues are $829,000 for 2017, sales returns and allowances are $56,900, and the allowance for doubtful accounts has a credit balance of $9,000.

Prepare the adjusting entry to record bad debt expenses in 2017.

Analyzing and computing accrued warranty liability and expense waymire company sells a motor that carries a 60-day unconditional warranty against product failure. from prior years' experience, waymire estimates that 2% of units sold each period will require repair at an average cost of $100 per unit. during the current period, waymire sold 69,000 units and repaired 1,000 units. (a) how much warranty expense must waymire report in its current period income statement? (b) what warranty liability related to current period sales will waymire report on its current period-end balance sheet? (hint: remember that some units were repaired in the current period.) (c) what analysis issues must we consider with respect to reported warranty liabilities?