Crane Company sells automatic can openers under a 75-day warranty for defective merchandise. Based on past experience, Crane estimates that 3% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $25. The units sold and units defective that occurred during the last 2 months of 2020 are as follows.

Month		Units Sold		Units Defective Prior to December 31
November		36,400		728
December		38,400		480

(a)

Prepare the journal entry to record the costs incurred in honoring 1,208 warranty claims. (Assume actual costs of $30,200.) (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
enter an account title to record honoring of warranty contracts	enter a debit amount	enter a credit amount
enter an account title to record honoring of warranty contracts	enter a debit amount	enter a credit amount
(To record honoring of warranty contracts.)