TB MC Qu. 7-73 (Static) In December Year 1, Lucas Corporation.... In December Year Locas Corporation sold morchandise for $10.000 cosh Locas estimated that $700 of warranty chomsmght be filed in regard to these sales on February 12, Year 2. warranty work mounting to $550 wes petformed for one of the customers ($430 labor paid in cash and $120 from the materials inventory) Which of the following answers correctly shows the effect of the recognition of the warranty obligation at the end of Year 1 on the financial statements of locas? Balance sheet Inco Statent Stockholders Equity 700 (700) Revenue 700 A. abilities 000) n/a (700) 700 n/a (700) (700) n/a Expense n/a 700 n/a 700 Net Income 700 (780) na (700) Statement of cash Blow n/a (700) OA (700) na C. 0. (700) n/a Multiple Choice Choice A Choice B Choice Choice D