The following selected transactions were taken from the books of Ripley Company for Year $1$:

On February $1,$ Year $1,$ borrowed $$54,000$ cash from the local bank. The note had a $6$ percent interest rate and was due on June $1,$ Year $1.$

Cash sales for the year amounted to $$240,000$ plus sales tax at the rate of $8$ percent.

Ripley provides a $90-$day warranty on the merchandise sold. The warranty expense is estimated to be $3$ percent of sales.

Pald the sales tax to the state sales tax agency on $$185,000$ of the sales.

Pald the note due on June $1$ and the related interest.

On November $1,$ Year $1,$ borrowed $$49,000$ cash from the local bank. The note had a $8$ percent interest rate and a one$-$year term to maturity.

Pald $$3,100$ in warranty repalrs.

A customer has filed a lawsult against Ripley for $$12$ million for breach of contract. The company attorney does not belleve the sult has merlt.

Required

a$.$ Answer the following questions:

What amount of cash did Ripley pay for Interest ciuring Year $1?$

What amount of interest expense is reported on Ripley's income statement for Year $1?$

What is the amount of warranty expense for Year $1?$

b$.$ Prepare the current Ilabilities section of the balance sheet at December $31,$ Year $1.$

c$.$ Show the effect of these transactions on the financlal statements using a horizontal statements model like the one below. Use $$ for Increase or $-$ for decrease. In the Cash Flow column, indicate whether the item is an operating activity $($OA$),$ Investing activity $($IA$),$ or financing activity $($FA$).$ Columns for events that have no effect on any of the elements should be left blank. The first transaction has been recorded as an example.

Complete this question by entering your answers in the tabs below.

Required A

Required $B$

Required $C$

What amount of cash did Ripley pay for interest during Year $1?$

What amount of interest expense is reported on Ripley's income statement for Year $1?$

What is the amount of warranty expense for Year $1?$

Note: For all requirements, do not round intermediate calculations. Round your final answers to nearest whole dollar amount.

Show less $1$

Cash paid for interest

Interest expense

Warranty expense