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Required information Problem 9-4A (Algo) Estimating warranty expense and liability LO P4 [The following information applies to the questions displayed below] On October 29 , Lobo Company began operations by purchasing razors for resale. The razors have a 90 -day warranty. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $15 and its retail selling price is $60. The company expects warranty costs to equal 9% of dollar sales. The following transactions occurred. November 11 Sold 80 razors for $4,800 cash. Rovember 30 Recognized warranty expense related to November nales with an adjusting entry. December 9 Replaced 16 razors that were returned under the warranty. December 16 sold 240 razors for $14,400 esh. December 29 Replaced 32 razors that were returned under the warranty. December 31 Recognized warranty expense related to December sales with an adjusting entry. January 5 sold 160 razors for $9,600 cash. January 17 Replaced 37 razors that were returned under the warranty. January 31 Recognized warranty expense related to January sales with an adjusting entry. Problem 9-4A (Algo) Part 1 Required: 1. Prepare journal entries to record above transactions and adjustments. Journal entry worksheet 4 5 6 7 Record the sales revenue of 80 razors for $4,800 cash. Note: Enter debits before credits

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