Warranty Costs Milford Company sells a motor that carries a three-month unconditional warranty against product failure. Based on a reliable statistical analysis, Milford knows that between the sale and the end of the product warranty period, two percent of the units sold will require repair at an average cost of $50 per unit. The following data reflect Milford's recent experience: October November December Dec. 31 Total 26,000 26,000 28,000 80,000 Units sold Known product failures from sales in: October November December 130 160 190 140 220 480 360 210 210 Calculate, and prepare a journal entry to record, the estimated liability for product warranties at December 31. Assume that warranty costs of known failures have already been reflected in the records. General Journal Date Description Debit Credit Dec.31 Product Warranty Expense Estimated Liability for Product Warranty To provide for estimated future warranty expense. $ $