Exhibit 13-4 During 2010, the Alexandra Company Began Selling a New

Multiple Choice

Exhibit 13-4 During 2010, the Alexandra Company began selling a new type of machine that carries a two-year warranty against all defects.Based on past industry and company experience, estimated warranty costs should total $2, 000 per machine sold.During 2010, sales and actual warranty expenditures were $2, 000, 000 (40 machines) and $22, 000, respectively.
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Refer to Exhibit 13-4.What amount should Alexandra report as its warranty expense for 2010?

A) $ 0
B) $ 22, 000
C) $ 80, 000
D) $160, 000