Autotether, Inc. sells 1.200 units of a product that has a one-year warranty on parts. The average cost of honoring one warranty contract is $60. During the year 60 contracts are honored at a cost of $3,600. It is estimated that 120 contracts will be honored in the following year. The adjusting entry at the end of the current year will include a Select one: a. Credit to Warranty Liability for $10,800. O b. Credit to Warranty Liability for $7.200. e c. Debit to Warranty Expense for $3,600. ed. Debit to Warranty Expense for $10,800. Nicklaus Company has decided to sell one of its old machines on June 30, 2021. The machine was purchased for $200,000 on January 1, 2017, and was depreciated on a straight-line basis using a useful life of 10 years with no salvage value. If the machine was sold for $65,000, what was the amount of the gain or loss recorded at the time of the sale? Select one: O a. $45,000 loss. e b. $115,000 loss. c. $55,000 gain d. $135,000 loss