Why are warranty liabilities usually recognized on the balance sheet as liabilities even when they are uncertain?
Answer to relevant QuestionsSuppose that a company has a facility located in an area where disastrous weather conditions often occur. Should it report a probable loss from a future disaster as a liability on its balance sheet? Why?Hinton Designers, located in Quebec, provided $7,300 of services on credit to a client on May 7, 2014. Record Hinton’s entry, including the appropriate GST and PST.Wang Corp. estimates income tax expense to be $285,600 for the year 2014. Record estimated income tax for January on January 31, 2014, and the payment on February 1, 2014.South Seas Fisheries had the following additional information at its November 30, 2014, year-end:a. The Unearned Revenue account showed a balance of $62,000, which represented four months of services paid in advance by a ...Whitby Company, located in Ontario, is preparing adjusting entries at December 31, 2014. An analysis reveals the following:a. During December, Whitby sold 6,500 units of a product that carries a 60-day warranty. The sales ...
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