Carnes Electronics sells consumer electronics that carry a 90-day manufacturer's warranty. At the time of purchase, customers are offered the opportunity to also buy a two-year extended warranty for an additional charge. During the year, Carnes received $420,000 for these extended warranties (approximately evenly throughout the year). Required: 1-a. Does this situation represent a loss contingency? 1.b. How should it be accounted for? 2. Prepare journal entries that summarize sales of the extended warranties and any aspects of the warranty that should be recorded during the year. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Does this situation represent a loss contingency? Loss contingency Req 1A Req 1B Req 2 How should it be accounted for? Revenue is deferred as a and warranty expense is computed using the in 2021. < Req 1A Req 2 > Req 1A Req 1B Req 2 Prepare journal entries that summarize sales of the extended warranties and any aspects of the warrant the year. (If no entry is required for a transaction/event, select "No journal entry required" in the first a to 2 decimal places.) View transaction list Record the sale of extended warranty. > 2 Record the revenue earned on extended warranty. Credit :X: