Assurance-Type Warranty Instructions | Chart of Accounts General Journal Balance Sheet Instructions Clean-All Inc. sells, on account, washing machines with a 3-year assurance-type warranty. In the past, Clean-All has found that in the year after sale, warranty costs have been 3% of sales, in the second year after sale, 5% of sales, and in the third year after sale, 7% of sales. The following data are also available: Warranty Year Sales Expenditures 2016 $520,000 2017 640,000 2018 700,000 $64,480 80,640 84,700 Required: 1. Prepare the journal entries for the preceding transactions for 2016-2018. Closing entries are not required. 2. What amount would Clean-All report as a liability on its December 31, 2018, balance sheet, assuming the liability had a balance of $89,200 on December 31, 2015? 3. Next Level How would the failure to recognize a contingent liability affect the financial statements? PAGE 2016 PAGE 2017 PAGE 2018 GENERAL JOURNAL DATE ACCOUNT TITLE POST. REF DEBIT CREDIT What amount would Clean-All report as a liability on its Dber 31, 2018, balance sheet, assuming the liability had a balance of $89,200 on December 31, 2015? Complete Clean-All Inc.'s partial balance sheet at December 31, 2018. Additional Instructions Clean-All Inc. Partial Balance Sheet December 31, 2018 1 Current Liabilities