Copperield and Company has decided to provide a warranty on its products. The previous clark lef a note with the files on this new warranty on glass breakage, deciding that an entry for warranty expense was not necessary, with the following reasoning: 'Our product is the finett in the work, and thus the contingency of a warranty replacement for breakage is remote. Under accounting standards, the proper treatment for a remote Welhood of occurrence is to take no action. Accordingly, in my protessional judgment, no journal enty should be made tor warranty expense." You should review the previous clerk's notes and evaluate the decision. After retreshing your memary an the treatment of contingent liabilites what action will you take? Make no entry, but disciose the possible warranty labilfy amount in the notes to the company firancial statervents. Bince there's no way to accurately determine the amount of breakage that might occur, no entry or disolosure is required. Make no entry; the previous clerk is correct that there is a remole chance of any breakiage. Joumalize an adjusting entry debiting Product Warranty Expense and creciting Procuct Warranty Payable. Assume that a reasonable estimate of the warranty cost can be delermined by an examination of prior breakage and replacement data