Cupola Awning Corporation introduced a new line of commercial awnings in 2018 that carry a two-year warranty against manufacturer's defects. Based on their experience with previous product introductions, warranty costs are expected to approximate 2% of sales. Sales and actual warranty expenditures for the first year of selling the product were Sales Actual Warranty Expenditures $42,000 $5,880,000 Required: 1. Does this situation represent a loss contingency? 2. Prepare journal entries that summarize sales of the awnings (assume all credit sales) and any aspects of the warranty that should be recorded during 2018 3. What amount should Cupola report as a liability at December 31, 2018? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 1 Required 2 | Required 3 Does this situation represent a loss contingency? Loss contingency Journal entry worksheet Record the 2018 sales. Note: Enter debits before credits. Event General Journal Debit Credit Dr . Journal entry worksheet 1 Record the accrued liability and expense. Note: Enter debits before credits. Event General Journal Debit Credit 1 2 3 Record the actual expenditures. Note: Enter debits before credits. Event General Journal Debit Credit 3. What amount should Cupola report as a liability at December 31, 201 Complete this question by entering your answers in the tabs bele Required 1 | Required 2 Required by What amount should Cupola report as a liability at December 31, 2018? Liability