Garage Hardware Ltd$.$ provides a product warranty for defects on two major lines of items sold since the beginning of $20$X$5.$ Line A carries a two$-$year warranty for parts and service, while Line B carries a three$-$year warranty for parts and service. The warranty cannot be purchased separately, and is intended to provide assurance to customers that the products will operate in accordance with the specifications provided. Garage contracts with a local service company to service the warranty on Line A $,$ at a cost of $$75$ per unit payable at the date of sale. Garage performs its own warranty work for Line B$.$ On the basis of experience, Garage estimates that warranty work costs $3\%$ of sales for parts and $7\%$ for labour and overhead for the entire three years; this cost is expected to be incurred $25\%$ in year $1,10\%$ in year $2,$ and $65\%$ in year $3.$

Data is as follows:

$\backslash$table$[[,20\backslash$times $5,20\backslash$times $6,],[$Sales in units, Line A$,700,1,000,],[$Sales price per unit, Line A$,$$$610,$$$660,],[$Sales in units, Line B$,600,800,],[$Sales price per unit, Line B$,$$$700,$$$750,],[$Actual warranty outlays, Line B:$,,,],[$Parts$,$$$3,000,$$$9,600,],[$Labour and overhead,$7,000,22,000,$$$12,000]]$

Required: $$

Prepare journal entries for annual sales, expense, and warranty transactions for $20$ X $5$ to $20$X$7,$ inclusive. Because of uncertainty of estimates, no discounting is to be applied.

How much is warranty expense in each year from $20$X$5$ to $20$X$7?$

What is the balance in the provision for warranty at $31$ December $20$X$5,20$X$6,$ and $20$X$7?$

What warranty work is left to do at the end of $20$X$7?$