Question

at the beginning of 2024, angel corporation began offering a two-year warranty on its products. the warranty program was expected to cost angel 4% of net sales. net sales made under warranty in 2024 were $218 million. fifteen percent of the units sold were returned in 2024 and repaired or replaced at a cost of $4.80 million. the amount of warranty expense on angel's 2024 income statement is:

Answer 1

The amount of warranty expense on Angel's 2024 income statement is $8.56 million (M).

What is expense?

An expense is a cost that is incurred in the course of running a business. Expenses can include the cost of goods and services, the cost of rent and utilities, the cost of salaries and wages, and the cost of travel and entertainment. An expense is a cost that is incurred in order to generate revenue. An expense can be either a direct cost, such as raw materials or labor, or an indirect cost, such as marketing or rent. Expenses are incurred in order to generate revenue, and they are typically recorded on a company's income statement.

The amount of warranty expense on Angel's 2024 income statement is $8.56 million (M).
This amount can be calculated using the following equation:
Warranty Expense = (Net Sales x 4%) + (Units Returned x Cost per Unit)
= ($218M x 4%) + (15% of Units Sold x $4.80M)
= $8.56M

To learn more about expense
https://brainly.com/question/14697297
#SPJ4