Ford Motor Company disclosed estimated product warranty payable for comparative years as follows: Ford?s sales were $160,123
Question:
Ford Motor Company disclosed estimated product warranty payable for comparative years as follows:
Ford?s sales were $160,123 million in 2005 and increased to $176,896 million in 2006. Assume that the total paid on warranty claims during 2006 was $14,000 million.
a. Why are short- and long-term estimated warranty liabilities separately disclosed?
b. Provide the journal entry for the 2006 product warranty expense.
Transcribed Image Text:
(in millions) 12/31/06 12/31/05 Current estimated product warranty payable Noncurrent estimated product warranty payable Total $13,644 8,289 $21,933 $13,074 7,359 $20,433
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a The warranty liability represents estimated outstanding automob...View the full answer
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Related Book For
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
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