Wright Machinery Corporation manufactures automible enginesfor major automobile producers. these engiines have a warrantyagainst any defects for a period of five years. Even though wrightMachiney does not have a seperate warranty contract, it assumesthat the $993 selling price of each egine includes an impliedservice contract of $73 per engine. During 2007 WrightMachinery sold 8000 engines to National Motors. During 2007 WrightMachinery repaired defective motors at a cost of $94,400.
Required
Prepare the journal entries for the preceeding transactions,assuming that wright Machinery uses the sales warranty accrualmethod to account for warranties.