A 1 Gonzalez Equip Company sold 2 During 2021, 3 All applicable B D E 1000 Rollomatics during 2020 at Gonzalez spent $35,000 servicing the 2-year warranties transactions are on a cash basis. $1,000 each on Rollomatic. 4 Instructions: 5 (a) 6 7 Prepare 2021 entries for Gonzalez using the expense warranty approach. Assume that Gonzalez estimates the total cost of servicing the warranties will $65,000 8 for 2 years. 9 10 11 12 13 14 15 16 17 18 19 20 F G 21 22 (b) 23 Prepare 2021 entries for Gonzalez assuming that the warranties are not an integral part of the sale. 24 Assume that of the sales total, $80,000 relates to sales of warranty contracts. 25 Gonzalez estimates the total cost of servicing the warranties will be 26 Estimate revenues earned on the basis of costs incurred and estimated costs 27 28 $70,000 for 2 years. 29 30 31 32 33 34 35