Required information Problem 9-4A (Static) Estimating warranty expense and liability LO P4 [The following information applies to the questions displayed below.] On October 29, Lobo Company 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 $20 and its retail selling price is $75. The company expects warranty costs to equal 8% of dollar sales. The following transactions occurred. November11November30December9December16December29December31January5January17January31Sold105razorsfor$7,875cash.RecognizedwarrantyexpenserelatedtoNovembersaleswithanadjustingentry.Replaced15razorsthatwerereturnedunderthewarranty.Sold220razorsfor$16,500cash.Replaced30razorsthatwerereturnedunderthewarranty.RecognizedwarrantyexpenserelatedtoDecembersaleswithanadjustingentry.Sold150razorsfor$11,250cash.Replaced50razorsthatwerereturnedunderthewarranty.RecognizedwarrantyexpenserelatedtoJanuarysaleswithanadjustingentry. November 11 Sold 105 razors for $7,875cash. November 30 Recognized warranty expense related to November sales with an adjusting entry. December 9 Replaced 15 razors that were returned under the warranty. December 16 Sold 220 razors for $16,500cash. December 29 Replaced 30 razors that were returned under the warranty. December 31 Recognized warranty expense related to December sales with an adjusting entry. January 5 Sold 150 razors for $11,250cash. January 17 Replaced 50 razors that were returned under the warranty. January 31 Recognized warranty expense related to January sales with an adjusting entry. Problem 9-4A (Static) Part 1 Required: 1. Prepare journal entries to record above transactions and adjustments