Warranties Kim's Athletics sells bicycles and other sports and athletic equipment. Sales and expected warranty claims for the year are as follows: Expected Warranty Claims for Warranty Period Item Unit Sales Cost per Claim Mountain bikes 1,000 1 claim per 100 sold $71 Racing bikes 600 10 claims per 100 sold 39 Snowboards 2,500 4 claims per 100 sold 44 Required: 1. Prepare the entry to record warranty expense for Kim's for the year. If an amount box does not require an entry, leave it blank. Dec. 31 88 (Record warranty expense) 2. Conceptual Connection: Why does Kim's have to record a liability for future warranty claims? Warranties are Therefore, companies must record and a corresponding if such contingent amounts are