Meridian Appliances sells goods with a one-year warranty and recognises a warranty provision (IAS 37).
| Date | Event |
|---|
| During 2025 | Sold goods for cash totalling $500,000. |
| December 31, 2025 | Estimated warranty costs at 3% of sales and recognised the provision. |
| During 2025 | Paid $9,000 cash for actual warranty repairs. |
Required: Prepare the entries for the cash sales, the year-end warranty provision (3% × $500,000), and the actual warranty repairs paid in cash. Use a Warranty Provision liability and a Warranty Expense.