Accrued Product Warranty General Motors Corporation (GM) disclosed estimated product warranty payable for comparative years as follows: (in millions) Year 2 Year 1 Current estimated product warranty payable $3,059 $2,884 Noncurrent estimated product warranty payable 4,327 4,147 Total $7,386 $7,031 Presume that GM's sales were $135,592 million in Year 2 and that the total paid on warranty claims during Year 2 was $3,000 million. a. The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash demands on the business relative to the quick current assets and other longer-term demands . Feedback Review the need for a classified balance sheet. b. Provide the journal entry for the Year 2 product warranty expense. Product Warranty Expense Product Warranty Payable
Accrued Product Warranty General Motors Corporation (GM) disclosed estimated product warranty payable for comparative years as follows: (in millions) Year 2 Year 1 Current estimated product warranty payable $3,059 $2,884 Noncurrent estimated product warranty payable 4,327 4,147 Total $7,386 $7,031 Presume that GM's sales were $135,592 million in Year 2 and that the total paid on warranty claims during Year 2 was $3,000 million. a. The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash demands on the business relative to the quick current assets and other longer-term demands . Feedback Review the need for a classified balance sheet. b. Provide the journal entry for the Year 2 product warranty expense. Product Warranty Expense Product Warranty Payable
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Accrued Product Warranty
General Motors Corporation (GM) disclosed estimated product warranty payable for comparative years as follows:
| (in millions) | ||||
| Year 2 | Year 1 | |||
| Current estimated product warranty payable | $3,059 | $2,884 | ||
| Noncurrent estimated product warranty payable | 4,327 | 4,147 | ||
| Total | $7,386 | $7,031 |
Presume that GM's sales were $135,592 million in Year 2 and that the total paid on warranty claims during Year 2 was $3,000 million.
a. The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash demands on the business relative to the quick current assets and other longer-term demands .
Review the need for a classified
b. Provide the
| Product Warranty Expense | |||
| Product Warranty Payable |
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