Randy Machine Tools sells an industrial lawn mower and offers a two-year warranty to its customers. The company sold 480 units of the lawn mower at an average price of $1,200 per unit in 2016. The company estimated that warranty costs would average $105 per lawn mower over two years. Actual costs incurred by Randy to honor warranty claims in 2016 totaled $28,000 ($17,000 for labor, $10,000 for parts and the rest cash).

Required a. Prepare all journal entries in 2016.