During April, a company sells $360,000 in merchandise that has a one year warranty on parts. Experience shows that warranty expenses average about 6% of the selling price. During September, customers returned merchandise for warranty repairs that used $9,400 in parts for repairs.

The entry to record the estimated warranty expense for April is:

Group of answer choices

a)The correct journal entry is not given.

b)Debit Bad Debt Expense $21,600; credit Estimated Warranty Liability $21,600.

c)Debit Estimated Warranty Liability $21,600; credit Warranty Expense $12,200, credit Cash, $9,400.

d)Debit Warranty Expense $9,400; credit Estimated Warranty Liability $9,400.

e)Debit Warranty Expense $21,600; credit Estimated Warranty Liability $21,600.