Estimated warranty liability OBJ. 5 Chloe Co. sold $300,000 of equipment during January under a one-year warranty. The cost to repair defects under the warranty is estimated at 5% of the sales price. On June 20, a customer required a $90 part replacement, plus $42 of labor under the warranty.

Provide the journal entry for

(a) the estimated warranty expense on January 31 for January sales, and

(b) the June 20 warranty work.