Madison Co. sells merchandise for $250,000 during the current year, along with a two-year warranty (covering this year and the following year) for $25 per product. Warranty costs are estimated to be 0.5% of sales. The company sold $2,500 of warranties during the current year and incurred actual costs of $800 during the year related to the warranties. The company uses straight-line recognition of warranty revenue. a. Record the sale of the merchandise and warranties, ignoring the cost of goods sold entry. Assume cash sales. b. Record the warranty service costs for the current year. Assume cash payments. c. Record the warranty revenue recognized during the current year