A company estimates that warranty expense will be 5% of sales. The company's sales for the current period is $187,000. The current period's entry to record the warranty expense is:

No entry is recorded until the items are returned for warranty repairs.

Warranty Liability	9350
Cash		9350

Estimated Warranty Liability	9350
Estimated Warranty Expense		9350

Warranty Expense	9350
Sales		9350

Warranty Expense	9350
Estimated Warranty Liability		9350