Exercise 11-5 Betancourt Company sells automatic can openers under a 75-day warranty for defective merchandise. Based on past experience, Betancourt estimates that 3% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $20. The units sold and units defective that occurred during the last 2 months of 2017 are as follows. Month Units Sold Units Defective Prior to December 31 November 30,800 616 December 32,800 410 Prepare the journal entries to record the estimated liability for warranties and the costs incurred in honoring 1,026 warranty claims. (Assume actual costs of $20,520.) (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To accrue estimated warranty costs.) (To record honoring of warranty contracts.) Link to Text Determine the estimated warranty liability at December 31 for the units sold in November and December. Estimated warranty liability $ Link to Text Give the entry to record the honoring of 500 warranty contracts in January at an average cost of $20. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit