During the Month, Evergreen Roofing Settled $600 in Warranty Claims

Multiple Choice

During the month, Evergreen Roofing settled $600 in warranty claims by replacing the defective flashing. Evergreen uses an estimated warranty account. The journal entry to record the settled claims would have been:

A) debit Estimated Warranty Payable $600; credit Cash $600.
B) debit Estimated Warranty Payable $600; credit Inventory $600.
C) debit Warranty Expense $600; credit Estimated Warranty Payable $600.
D) debit Warranty Expense $600; credit Cash $600.