Al Jabel Corporation sells WIFI speakers and offers 2-year warranty contract to customers. During 2020 Al Jabel sold 15,000 warranty contract at $99 each. Al Jabel spent $ 135,000 serving warranties during 2020, and it estimates that an additional $675,000 will be spent in the future to service the warranties. Prepare journal entries for:

(a) The sale of contract

(b) The cost of servicing warranties

(c) The recognition of warranties revenue