3. Crank the Volume grants a 120-day warranty on all stereos. Historically, approximately 1% of all units sold prove to be defective, requiring an average repair bill of $100. Sales in March are $472,500 for 4,500 units. In March, $3,900 of defective units are returned for replacement. What entry must Crank the Volume make at the end of March to record the warranty expense?

a. Debit Warranty Expense and credit Provision for Warranty Repairs, $4,725.

b. Debit Warranty Expense and credit Provision for Warranty Repairs, $3,900.

c. Debit Warranty Expense and credit Cash, $4,725.

d. No entry is needed at March 31.