Answer Happy

WARRANTY ARRANGEMENT







During 2021, Bird Corp. sells talking parrots to customers each
with a guarantee that the parrot is free from any
defects.



Duration of assurance warranty




2

years





Total estimated warranty costs



$
600







Warranty work done prior to year end

$
100



















Prepare the 2 journal entries related to the
assurance warranty required at 12-31.







OPTIONAL ADDITIONAL 2 POINTS

3 journal entries





During 2021 Bird Corp has also sold walking flamingo robot
birds.



The company offers a service type warranty on these flamingos.














Total cash
received from sale of flamingo robots

$ 3,000




Total of
that amount related to service warranties

$
500




Service
warranty costs incurred prior to year end

$
100





Duration of service type warranty



$
2

years













Prepare the 3 journal entries required at
12-31.