During its first year of operations Piano Limited had sales of $50,000. The company offers a 2- year limited warranty on all sales and expects that warranty costs for the first year will average 1% of sales with an additional 3% in the second year. During the current year, the company spent $1,000 cash on warranty repairs. Required: 1. Prepare all journal entries related to the warranty for the current year. 2. How will the warranty liability be reported on the company's year-end balance sheet