Best Cars Limited guarantees automobiles against defects for five years or 160,000 km, whichever comes first. Suppose BC can expect warranty costs during the five-year period to add up to 5% of sales. Assume that Barnstormer Motors in Barrie, Ontario, made sales of $2,100,000 on its passenger line during 2020. Barnstormer received cash for 10% of the sales and took notes receivable for the remainder. Payments to satisfy customer warranty claims totalled $80,000 during 2020. 1. Record the sales, warranty expense, and warranty payments for Barnstormer. Ignore any reimbursement that Barnstormer may receive from BC. 2. Post to the Estimated Warranty Payable T-account. The beginning balance was $40,000. At the end of 2020, how much in estimated warranty payable does Barnstormer owe its customers? ..... 1. Record the sales, warranty expense, and warranty payments for Barnstormer. Ignore any reimbursement that Barnstormer may receive from BC. First, let's record the sale of automobiles. (Record debits first, then credits. Explanations are not required.) Journal Entry Accounts Debit Credit Cash Notes Receivable Sales Revenue