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Bison Company reported sales revenue for 2013 of $900,000. The products were sold with a nineminus month warranty. Members of Bison's management estimate the cost

Bison Company reported sales revenue for 2013 of $900,000. The products were sold with a

nineminus

month

warranty. Members of Bison's management estimate the cost of the warranty will be equal to 5% of sales revenue. Which of the following will be included in the entry to record the actual amounts paid out as a result of warranty claims?

A.

a debit to Warranty Expense for the actual amount of payments

B.

a debit to Estimated Warranty Payable for the actual amount of payments

C.

a credit to Estimated Warranty Payable for $45,000

D.

a debit to Estimated Warranty Payable for $45,000

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