Harbour Company disclosed estimated product warranty payable for comparative years as follows: (in millions) Current Year Prior Year Current estimated product warranty payable $3,070 $2,868 Noncurrent estimated product warranty payable 4,345 4,138 Total $7,415 $7,006 Assume that Harbour Company's sales were $135,548 million in the current year and that the total paid on warranty claims during the current year was $3,100 million. Required: a. Why are short, and long-term estimated warranty liabilities separately disclosed? b. Provide the journal entry for the current year product warranty expense. c. What two conditions must be met in order for a product warranty liability to be reported in the financial statements? a. Why are short, and long-term estimated warranty liabilities separately disclosed? The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash the business, relative to the quick current assets and other longer- term receipts of demands on b. Select the journal entry for the current year product warranty expense. Entry 1 Product Warranty Expense 350,900,000 Product Warranty Payable 350,900,000 Entry 2 Product Warranty Expense 3,509,000,000 Product Warranty Payable 3,509,000,000 Entry 3 Supplies Expense 3,509,000,000 Wages Payable 3,509,000,000 Entry 4 Repairs Expense 3,509,000,000 Accounts Payable 3,509,000,000 C. What two conditions must be met in order for a product warranty liability to be reported in the financial statements? It is unlikely that the liability will occur and the amount of the liability is reasonably estimable. It is reasonably possible that the liability will occur and the amount of the liability is reasonably estimable. It is probable that the liability will occur and the amount of the liability cannot be estimated. It is probable that the liability will occur and the amount of the liability is reasonably estimable