During 2011, Gum Co. introduced a new product carrying a two- year warranty against defects. The estimated warranty costs related to dollar sales are 2% within 12 months following the sale and 4% in the second 12 months of the sale.

The sale and actual warranty expenditures for the years ended December 31, 2011, and 2012 are as follows:

SalesActual warranty expenditures
2011150,0002,250
2012250,0007,500
Total400,0009,750
What amount should Gum report as warranty expense on its 12/31/2012 Income Statement?

Afirm wants to hire a project manager (pm) at a salary of $100,000. 30% of pms have high ability, and 70% of pms have low ability. high ability pms generate $120,000 in revenue and low ability pms generate $80,000 in revenue. in addition to differences in productivity, high and low ability pms have different outside offers. if a high ability pm is not hired by the firm, she can work for another company at a salary of $80,000. if the low ability pm is not hired by the firm, she can work for another company for $70,000. high ability pms are also able to get a project management professional (pmp) certification at a cost of $1,000. low ability pms are unable to get a pmp certification (they would fail the test). the firm is not able to observe a pm’s ability, but is able to observe and verify whether or not the pm has a pmp certificate.(a) draw the extensive form of the game.expert answer