Early in 2020, Culvert Equipment sold 600 Rollomatics at $6100 each. During 2020, Culvert spent $20000 servicing the 2-year assurance warranties that the company Rollomatics

All sales transactions are on cash basis

a) Prepare 2020 entries for Culvert . Assume that Culvert estimates the total warranty cost of servicing the warranties is in the second year will be $34000

b) Prepare 2020 entries for Culvert assuming the warranties are not integral part of the sales (service-type warranty) Assume that sales total $55000 relates to sales of warranty contract. W warranty cost incurred in 2020 were $20000. Estimate revenue to be recognized on straight line basis