On December 1,SwiftyCompany introduces a new product that includes a one-year warranty on parts. In December,1,100units are sold. Management believes that4% of the units will be defective and that the average warranty costs will be $90per unit.

Prepare the adjusting entry at December 31 to accrue the estimated warranty cost, assuming no warranty claims have been honored to date.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date Account Titles and Explanation Debit Credit

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