[abood466466]

Hello

Can you help me in solving this Q's.. I really need them to study for my final exam,

Here is the Q's

Q(1) Use the following data for the next three questions.

Dubai’s Bagels incurred the following obligations during 2005.
10%, one-year, $ 9,000 note payable, issued November 1, 2005.
9%, three-year, $ 16,000 note payable, issued October 1, 2005.

a. What is the total Interest expenses on December 31, 2005.



b. What is the total interest expense for 2006:


c. What is the total current liabilities on the December 31, 2007 balance sheet :







Q(3) Rama, Inc. offers a two-year warranty against failure of its products. The estimated liability is 4% of sales in the year of sale and 6% in the second year. Sales for 2005 and 2006 were: $2,000,000 and $2,500,000, respectively. What is the warranty liability for 2005:








Q(4) Ajman, Inc. provides a two-year warranty on its products. Estimates are that 5% of sales will be returned for repair in the year of sale and 8% the following year. Sales and actual warranty costs for Goosen’s first two years of operations were:

SALES ACTUAL WARRANTY COSTS
2005 $ 800,000 $ 40,000
2006 $ 1,500,000 $ 120,000


Required:
a. Determine the warranty expense and warranty liability for 2005.

b. Determine the warranty expense for 2006.

[Curlyben]

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[abood466466]

Dear curlyben.. no pro :)

here is the solution that I got.. can u now correct me if I was wrong :)



Q(1) Dubai’s Bagels incurred the following obligations during 2005.
10%, one-year, $ 9,000 note payable, issued November 1, 2005.
9%, three-year, $ 16,000 note payable, issued October 1, 2005.

a. What is the total Interest expenses on December 31, 2005.

10% X 9000 X 2/12 = 150
9% X 16000 X 3/12 = 360

then 150 + 360 = 510


b. What is the total interest expense for 2006:

10% X 9000 X 10/12 = 750
9% X 16000 X 12/12 = 1440

then 750 + 1440 = 2190


c. What is the total current liabilities on the December 31, 2007 balance sheet :

$16,000




Q(3) Rama, Inc. offers a two-year warranty against failure of its products. The estimated liability is 4% of sales in the year of sale and 6% in the second year. Sales for 2005 and 2006 were: $2,000,000 and $2,500,000, respectively. What is the warranty liability for 2005:


2000000 X 4% = 80,000





Q(4) Ajman, Inc. provides a two-year warranty on its products. Estimates are that 5% of sales will be returned for repair in the year of sale and 8% the following year. Sales and actual warranty costs for Goosen’s first two years of operations were:

SALES ACTUAL WARRANTY COSTS
2005 $ 800,000 $ 40,000
2006 $ 1,500,000 $ 120,000


Required:
a. Determine the warranty expense and warranty liability for 2005:

Warranty expense= 5% X 800,000 = 40,000

Warranty liabilty= 40000 - 40000 = 0


b. Determine the warranty expense for 2006.

8% X 800000 = 64,000
5% X 1500000 = 75,000

then 64000 + 75000 = 139,000

please check is for me.. thank you in advance