A company sells goods with a warranty for the cost of repairs required in the first 1 month after purchase. Past experience of suggests: stion i) 85% of the goods sold will have no defects ii) 8% will have minor defects iii)7% will have major defects If minor defects were detected in all products sold, the cost of repairs will be OMR 66,000; if major defects were detected in all products sold, the cost would be OMR 272,000. What amount of provision should be made? OMR 50,700 OMR 24,320 OMR 26,380 个 None of them

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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A company sells goods with a warranty for the cost of repairs required in the first 1 month after purchase. Past experience
of
suggests:
stion
i) 85% of the goods sold will have no defects
ii) 8% will have minor defects
iii)7% will have major defects
If minor defects were detected in all products sold, the cost of repairs will be OMR 66,000; if major defects were detected in all
products sold, the cost would be OMR 272,000.
What amount of provision should be made?
OMR 50,700
OMR 24,320
OMR 26,380
个
None of them
Transcribed Image Text:A company sells goods with a warranty for the cost of repairs required in the first 1 month after purchase. Past experience of suggests: stion i) 85% of the goods sold will have no defects ii) 8% will have minor defects iii)7% will have major defects If minor defects were detected in all products sold, the cost of repairs will be OMR 66,000; if major defects were detected in all products sold, the cost would be OMR 272,000. What amount of provision should be made? OMR 50,700 OMR 24,320 OMR 26,380 个 None of them
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