In the most recent year of operations, Bertha's Games sold merchandise costing $104,000 for $194,000. All merchandise was sold under a 1-year warranty. At the time of sale, Bertha estimated that warranty claims would amount to 7% of sales. During the year, she replaced defective merchandise for $6,000. All transactions were cash transactions.
Prepare journal entries to record all transactions related to the warranty.
Based solely on the above information, determine Berthas's Games operating income for the year.