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Blue Corp provides a 3 - year warranty with one of its products which was first sold in 2 0 2 0 . Blue sold

Blue Corp provides a 3-year warranty with one of its products which was first sold in 2020. Blue sold $1,200,000 such products. The company expects $367,500 of warranty costs. The actual warranty costs incurred in 2021 was $270,000. How much warranty expense did Blue recognize in 2021?
$122,500
$3,500
$0
$367,500
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