Problem
Felice Corporation sells blenders with an extended warranty, which kicks in after the embedded warranty expires after one year. During 20X6, Felice sold 700 blenders and out of those, 300 were sold with the extended warranty. The extended warranty costs $10. In 20X7, Felice made repairs under the extended warranty of $200. Felice recognizes revenue using a straight-line basis over 2 years. Which journal entries records revenue earned from the extended warranties in 20X7?