as or arized to sela sngle product that camesa 45day wara tv

as or arized to sela sngle product that camesa 45-day wara tv agans defects es indicate that 6% e urits sold wil prove denective d equire an average repair cos o S20 per unit r ng Campings rs orth of operations, tal sales were 400 unts; by the end o he o ngineering es m manth, 5 defecve units had been repaired The Fabiity for product warranties at month-end should be OA. $100 B, 5380 OC. s80 D. S500

Solution

Liability for product warranty = (400*6%-5)*20= $380 Option B is correct