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XYZ Company sold a product for $20,000 in October that includes a 24-month warranty for repairs. XYZ Company has concluded from prior years that the

XYZ Company sold a product for $20,000 in October that includes a 24-month warranty for repairs. XYZ Company has concluded from prior years that the average cost of repairs over the warranty period is 4% of the sales price.

What is the entry required to record the estimated product warranty expense for October 31st?

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