Woodmier Lawn Products introduced a new line of commercial sprinklers in 2020 that carry a one-year warranty against manufacturer's defects. Because this was the first product for which the company offered a warranty, trade publications were consulted to determine the experience of others in the industry. Based on that experience, warranty costs were expected to approximate 2% of sales. Sales of the sprinklers in 2020 were $4.2 million. Accordingly, the following entries relating to the contingency for warranty costs were recorded during the first year of selling the product:

General Journal	Debit	Credit
Accrued liability and expense
Warranty expense (2% $4,200,000)	84,000
Warranty liability		84,000
Actual expenditures (summary entry)
Warranty liability	36,000
Cash		36,000

In late 2021, the company's claims experience was evaluated and it was determined that claims were far more than expected3% of sales rather than 2%. Required: 1. Assuming sales of the sprinklers in 2021 were $5.3 million and warranty expenditures in 2021 totaled $105,000, prepare any journal entries related to the warranty. 2. Assuming sales of the sprinklers were discontinued after 2020, prepare any journal entry(s) in 2021 related to the warranty.

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Camden Biotechnology began operations in September 2021. The following selected transactions relate to liabilities of the company for September 2021 through March 2022. Camdens fiscal year ends on December 31. Its financial statements are issued in April. 2021

1. On September 5, opened checking accounts at Second Commercial Bank and negotiated a short-term line of credit of up to $26,000,000 at the bank's prime rate (15.5% at the time). The company will pay no commitment fees.
2. On October 1, borrowed $23 million cash from Second Commercial Bank under the line of credit and issued a five-month promissory note. Interest at the prime rate of 15% was payable at maturity. Management planned to issue 10-year bonds in February to repay the note.
3. Received $1,900 of refundable deposits in December for reusable containers used to transport and store chemical-based products.
4. For the SeptemberDecember period, sales on account totaled $5,080,000. The state sales tax rate is 3% and the local sales tax rate is 3%. (This is a summary journal entry for the many individual sales transactions for the period.)
5. Recorded the adjusting entry for accrued interest.

2022

6. In March, paid the entire amount of the note on its March 1 due date, using proceeds from a February issuance of $21.0 million of 10-year bonds at face value, along with other available cash.
7. The storage containers covered by refundable deposits are expected to be returned during the first nine months of the year. Half of the containers were returned in March 2022.

Required: 1. Prepare the appropriate journal entries for items a-g. 2. Prepare the current and long-term liability sections of the December 31, 2021, balance sheet. Trade accounts payable on that date were $343,000.