A company provides a 2-year warranty with one of its products which was first sold in 2015 for $4,000,000. Streep estimates that $450,000 will be spent in the future to service warranty claims related to the 2015 sales. In 2015, Streep spent $130,000 servicing warranty claims.

Select one:

a. None of the above answers are correct

b. The entry to record the warranty includes a debit to Warranty liability

c. The entry to record the warranty follows the matching principle

d. The entry to record the warranty expenditures includes a debit to Warranty expense

e. I want to leave this question blank