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Please answer the below question. Thanks Luxury Inc. is an air conditioners manufacturer who will provide to its customers a 3-year assurance-type warranty against defects.

Please answer the below question. Thanks

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Luxury Inc. is an air conditioners manufacturer who will provide to its customers a 3-year assurance-type warranty against defects. Base on past experience, the estimated warranty costs related to sales amounts are: first year after sale - 1% of sales: second year after sale - 3% of sales: and third year after sale - 4% of sales. Set forth below are the sales and actual warranty expenses for the first 3 years of operation: Luxury Inc. uses 31 December as its financial year end. Required: Compute the amount that Luxury Inc. should report as a liability in its 31 December, 2016, statement of financial position. Assume that all sales are made evenly throughout each year with warranty expenses also evenly spaced relative to the rates above

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