During Year 1. its first year of operations, Benitez Co. reported sales of $280,000. At the end of Year 1, the company estimated its warranty obligation at 2% of sales. During Year 1, the company paid $3,600 cash to settle warranty claims. Which of the following statements is true? Multiple Choice All of these answer choices are correct. The warranties payable account has a balance of $2,000 at the end of Year 1. Cash decreased by 3,600 as a result of the accounting events associated with warranties in Year 1