Guillen Corporation manufactures and sells dishwashers. All dishwashers come with a 2-year warranty guaranteeing to repair any defects that are discovered during the 2-year period. In the current year, Guillen sold 100,000 dishwashers for $400 each. Analysis of past warranty records indicates that on average, 10% of all dishwashers sold are typically returned during the warranty period, and the average cost of repairing each dishwasher returned is $15. Assume expenditures for warranty repairs are made in cash. At the start of the current year, Guillen had a balance of $120,000 in its account "Estimated Warranty Liability." During the current year, ACTUAL expenditures for warranty claims were $50,000. Required: 1. Can these expected warranty costs be considered a 'contingency' according to the accounting definition of that word? Briefly explain. 2. If your answer to (1) is 'yes', show/explain the process for determining the appropriate accounting treatment of this set of facts. If your answer to (1) is 'no', explain why no accounting is needed for this set of facts. 3. Record all journal entries needed during the year to account for the warranty-related activity described above. 4. Calculate the balance that would be in the Estimated Warranty Liability account at the end of the year (Hint: A T-account would be handy to keep track of the activity you recorded in part (1))