Despite recent pressure from stockholders to increase profits, world extraction corp., a global petroleum organization, has maintained a practice of consistently acting ethically by being a good global corporate citizen, taking host-country and global standards into consideration when making decisions, and obeying the laws of host countries as well as international law. world extraction corp. provides an example of a company acting in a socially responsible way.

Analyzing and computing accrued warranty liability and expense waymire company sells a motor that carries a 60-day unconditional warranty against product failure. from prior years' experience, waymire estimates that 2% of units sold each period will require repair at an average cost of $100 per unit. during the current period, waymire sold 69,000 units and repaired 1,000 units. (a) how much warranty expense must waymire report in its current period income statement? (b) what warranty liability related to current period sales will waymire report on its current period-end balance sheet? (hint: remember that some units were repaired in the current period.) (c) what analysis issues must we consider with respect to reported warranty liabilities?