S9-3. (Learning Objective 1: Accounting for warranty expense and provision for warranty repairs) Lawry guarantees automobiles against defects for five years or 50,000 miles, whichever comes first. Assume that a Lawry dealer in Paris, France, made sales of $485,000 during 20X0. Lawry expects warranty costs during the five-year period to add up to about $29,100.

Lawry received cash for 30% of the sales and took notes receivable for the remainder. Payments to satisfy customer warranty claims totaled $18,000 during 20X0.

1. Record the sales, warranty expense, and warranty payments for Lawry.

2. Post to the Provision for Warranty Repairs T-account. The beginning balance was $11,000.

At the end of 20X0, how much in provision for warranty repairs does Lawry owe to its customers?