CA4-3 (Earnings Management) Bobek Inc. has recently reported steadily increasing income. The company reported income of €20,000 in 2007, €25,000 in 2008, and €30,000 in 2009. A number of market analysts have recommended that investors buy their shares because they expect the steady growth in income to continue. Bobek is approaching the end of its fiscal year in 2010, and it again appears to be a good year. However, it has not yet recorded warranty expense.