Disang sells satellite phones for $1,000 each with a one-year warranty against defects. Past experience indicates that
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Question:
Disang sells satellite phones for $1,000 each with a one-year warranty against defects. Past experience indicates that 5 percent of the units will prove defective and that the average repair cost for each is $100. This past year, 50,000 phones were sold, and 500 of these have already been returned for service.
Multiple Choice
None of these
The estimated liability for warranties at year end is $500,000
The estimated liability for warranties at year end is $250,000
The estimated liability for warranties at year end is $50,000
The estimated liability for warranties at year end is $200,000
Related Book For
Statistics for Management and Economics Abbreviated
ISBN: 978-1285869643
10th Edition
Authors: Gerald Keller
Posted Date: