Required information Problem 9-4A Estimating warranty expense and liability LO P4 [The following information applies to the questions displayed below) On October 29, Lobo Co. began operations by purchasing razors for resale. The razors have a 90-day warranty. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $15 and its retail selling price is $70. The company expects warranty costs to equal 6% of dollar sales. The following transactions occurred Nov. 11 Sold 60 razors for $4,200 cash 30 Recognized warranty expense related to November sales with an adjusting entry: Dec. 9 Replaced 12 rarors that were returned under the warranty. 16 Sold 180 rators for $12,600 cash 29 Replaced 24 rarors that were returned under the warranty: 31 Recognited warranty expense related to December sales with an adjusting entry. San. Sold 120 rarors for $3,400 cash 17 Replaced 29 razors that were returned under the warranty 31 Recognized warranty expense related to January sales with an adjusting entry. Journal entry worksheet 1 2 3 4 5 6 7 8 .... 12 Record the sales revenue of 60 razors for $4,200 cash. Note: Enter debits before credits Date General Journal Debit Credit Nov 11 Record entry Clear entry View general journal Journal entry worksheet 1 3 4 5 6 7 12 8 . Record the cost of goods sold for 60 razors. Note: Enter debits before credits Date Debit General Journal Credit Nov 11 Record entry Clear entry View general journal Journal entry worksheet ..... $ Record the cost of goods sold for 180 razors. Note: Enter debits before credits. Date General Journal Debit Credit Dec 16 Record entry Clear entry View general journal Journal entry worksheet Record the estimated warranty expense at 6% of December sales. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record entry Clear entry View general journal Journal entry worksheet Record the sales revenue of 120 razors for $8,400 cash. Note: Enter debits before credits. Date General Journal Debit Credit Jan 05 Record entry Clear entry View general journal Journal entry worksheet