Suppose Unitex Tire Company estimates that warranty costs will equal 1 percent of tire sales. Assume that November sales totaled \(\$ 900,000\) and that the company's outlay in tires and cash to satisfy warranty claims was \(\$ 7,400\). How much warranty expense should the November income statement report? ( \(p p .453-454\) )

a. \(\$ 1,600\)

b. \(\$ 7,400\)

c. \(\$ 9,000\)

d. \(\$ 16,400\)