E13 4 JWS Transport

January 1, 2012
Vacation Pay 400,000
Salaries Expense 4,000
Salaries Payable 404,000

December 31, 2012

Salaries Expense 10,000
Vacation Pay 10,000

E13 7 Diversified Semiconductors

Cash 850,000
Refundable Deposits 850,000

Refundable Deposits 790,000

Cash 790,000

Refundable Deposits 35,000

Sales Containers 35,000

Cost of Goods Sold 35,000

Inventory Containers 35,000

Refundable deposits liability [530,000 + (850,000 790,000 35,000] = PHP 555,000

E13 9 Sprint Corp

Short term note payable 756,000,000
Long Term note Payable 756,000,000

It is reported as a non-current liability due to its conversion to a long-term note

E13 10
E13 11 Cupola Awning Company

1. Yes, it is a provision. Why? The company expects future liabilities.

Warranty Expense 150,000
Estimated Warranty Liability 150,000

2. For sales and warranties incurred

Accounts Receivable 5,000,000
Sales 5,000,000
Estimated Warranty Liability 37,500
Cash 37,500

3. Estimated Warranty Liabilities 112,500

E13 12 Carnes Electronics
1. It is a provision since this event will lead to a liability in the near future.
2. Sales of Warranty
Accounts Receivable 412,000
Unearned Revenue 412,000
Unearned Revenue 412,000
Revenue from Extended Warranty 412,000

E13 13 Sound Audio

1. It should be accrued due to it being virtually certain or known.
2 - 4 Loss from Fire 2,000,000
Estimated liability from fire 2,000,000

E13 17 Woodmier Lawn

Case #1
Warranty Expense 180,000
Estimated Warranty Liability 180,000
Estimated Warranty Liability 88,000
Cash 88,000

Case #2
Warranty Expense 48,000
Warranty Liability 48,000