Required information (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 7% of dollar sales. The following transactions occurred. Nov. 11 Sold 80 razors for $5, 600 cash. 30 Recognized warranty expense related to November sales with an adjusting entry. Dec. 9 Replaced 16 razors that were returned under the warranty. 16 Sold 240 razors for $16,800 cash. 29 Replaced 32 razors that were returned under the warranty. 31 Recognized warranty expense related to December sales with an adjusting entry. Jan. 5 Sold 160 razors for $11,200 cash. 17 Replaced 37 razors that were returned under the warranty. 31 Recognized warranty expense related to January sales with an adjusting entry. 1. Prepare journal entries to record above transactions and adjustments. 1 Record the sales revenue of 80 razors for $5,600 cash. 2 Record the cost of goods sold for 80 razors. 3 Record the estimated warranty expense at 7% of November sales. 4 Record the replacement of 16 razors that were returned under the warranty. 5 Record the sales revenue of 240 razors for $16,800 cash. 6 Record the cost of goods sold for 240 razors. 7 Record the replacement of 32 razors that were returned under the warranty. 8 Record the estimated warranty expense at 7% of December sales. 9 Record the sales revenue of 160 razors for $11,200 cash. 10 Record the cost of goods sold for 160 razors. 11 Record the replacement of 37 razors that were returned under the warranty. 12 Record the adjusting entry for warranty expense for the month of January. 2. How much warranty expense is reported for November and December? Warranty expense for November Warranty expense for December 3. How much warranty expense is reported for January? Warranty expense 4. What is the balance of the Estimated Warranty Liability account as of December 31? Estimated warranty liability balance 5. What is the balance of the Estimated Warranty Liability account as of January 31? Estimated warranty liability balance