cuplo awing corproation introduced a new line of commerical awnings in 20201 that carry a two year warranty against manufacturers defect . Based on their experience with previous product introductions warranty cost are expected to approximate 4% of sales . sales and actual warranty expeenditures for the first year of selling the products were

sales 5,090,000 and acutual warranty expenditures $52,000

1, Does the situation represent o loss contingency

2. Prepare journal entries that summarize sales of the awning( assume all credit sales) and any aspects of the warranty that should be recorded during 2021

3. What amount should cupola report as a liablility at december 31, 2021