A company that offers a parts and labour warranty had a $50,000 balance in the warranty liability account at the beginning of 2020. During that year they honoured $40,000 worth of warranty contracts. They also determined that the warranty expense for product sales during the year should be $55,000. The entry to recognize the warranty expense for 2020 will include a debit to O Warranty Expense, $45,000. O Warranty Liability, $40,000. 4 O Warranty Liability, $45,000. O Warranty Expense, $55,000.