Business, 23.04.2021 21:00, EllaLovesAnime

On January 2, 2020, Pronghorn Company sells production equipment to Fargo Inc. for $52,000. Pronghorn includes a 2-year assurance warranty service with the sale of all its equipment. The customer receives and pays for the equipment on January 2, 2020. During 2020, Pronghorn incurs costs related to warranties of $890. At December 31, 2020, Pronghorn estimates that $640 of warranty costs will be incurred in the second year of the warranty. Required:
Prepare the journal entry to record this transaction on January 2, 2020, and on December 31, 2020.

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On January 2, 2020, Pronghorn Company sells production equipment to Fargo Inc. for $52,000. Pronghor...