Associates manufactures and distributes component parts for car audio systems. assurance-type warranty covers all repair costs, including parts and labor, for years after the date of sale. During the current year, sold 4,300,000 of component parts to several manufacturers of car audio systems. Ignore cost of cood sold. The company cannot estimate the future warranty costs. did not make any repairs in the year of the sale. However, during the following year, the company incurred 68,000 in actual warranty claims. The repair costs included 40,000 in parts and 28,000 in labor (unpaid). uses the cash-basis to account for its assurance-type warranty costs. What are the necessary journal entries related to these transactions?

1. Begin by recording the journal entry for the sale.

2. Record the journal entry for the warranty in the year of the sale.

3. Now, record the journal entry for the actual repairs incurred during the following year.