Required information Problem 9-4A (Static) 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 $20 and its retail selling price is $75. The company expects warranty costs to equal 8% of dollar sales. The following transactions occurred. November 11 Sold 105 razors for $7,875 cash. November 30 December 9 December 16 December 29 December 31 January 5 January 17 January 31 Recognized warranty expense related to November sales with an adjusting entry. Replaced 15 razors that were returned under the warranty. Sold 220 razors for $16,500 cash. Replaced 30 razors that were returned under the warranty. Recognized warranty expense related to December sales with an adjusting entry. Sold 150 razors for $11,250 cash. Replaced 50 razors that were returned under the warranty. Recognized warranty expense related to January sales with an adjusting entry. Problem 9-4A (Static) Part 1 Required: 1. Prepare journal entries to record above transactions and adjustments.