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Cheerolet Canada guarantees vehicles against defects for five years or 180,000km whichever comes first. Suppose Cheerolet can expect warranty costs during this period to add

image text in transcribed Cheerolet Canada guarantees vehicles against defects for five years or 180,000km whichever comes first. Suppose Cheerolet can expect warranty costs during this period to add up to 2.25% of sales. Assume that a local car dealership, Cheer-Guelph, made sales of $4,700,000 on their hybrid car line during 2021. Cheer-Guelph received cash for 22% of the sales and sells the rest on account. Payments to satisfy customer warranty claims totaled $87,000 during 2021. The beginning balance of the Estimated Warranty Payable account is zero. Requirement 1: Record the sales transaction (ignore CoGS/Inventory), warranty expense (using the Estimated Warranty Payable Account), and warranty payments for Cheer-Guelph. Ignore any reimbursement that Cheer-Guelph may receive from Cheerolet Canada. After submitting the online exam, upload the journal entries to the dropbox. Requirement 2: Please fill out the blanks below. Required format for entering numbers: enter plain amounts, no \$-signs or commas. Round final results to total \$-amounts. Blank \#1: What \$-amount did Cheer-Guelph record as Warranty Expense? Blank \#2: What \$-amount did Cheer-Guelph pay out to customers (Cash)? Blank \#3: What is the ending balance of the Estimated Warranty Payable account (\$

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