Concord, Inc. sells $1260$ units of a product that has a

one$-$year warranty on parts. The average cost of

honoring one warranty contract is $$70.$ During the

year $60$ contracts are honored at a total cost of $$4200.$

It is estimated that $120$ contracts will be honored in

the following year. The adjusting entry at the end of

the current year will include a

credit of Warranty Liability $$8400.$

credit of Warranty Liability $$12600.$

debit of Warranty Expense $$4200.$

debit of Warranty Expense $$12600.$