Montague Auto Repair specializes in the repair of foreign car transmissions. To encourage business, Montague offers a 6-month warranty on all repairs. The following data are available for the year: Assume that warranty claims are paid in cash. Required: 1. Compute the warranty expense for the year. 2. Prepare the entry to record the payment of warranty claims for the year. 3. Conceptual Connection: What is balance in the warranty liability account at December 31? Why has the balance in the warranty liability account changed from the beginning of the year? Warranty Expense s GENERAL JOURNAL \begin{tabular}{|l|l|l|l|l|} \hline & DATE & ACCOUNT & POST. REF. & \\ \hline 1 & & & & \\ \hline 2 & & & & \\ \hline \end{tabular} PAGE 1 URNAL Warranty Liability Why has the balance in the warranty liability account changed from the beginning of the year? The balance has because more claims were than were through warranty expense