Harbour Company disclosed estimated product warranty payable for comparative years as follows: Current Year (in millions) $15,520 9,440 $24,960 Current estimated product warranty payable i Noncurrent estimated product warranty payable Prior Year (in millions) $14,880 8,320 $23,200 Total Assume that Harbour's sales were $183,040 million in the current year and that the total paid on warranty claims during the current year was $16,000 million. a. The distinction between short and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash relative to the quick current assets and other longer-term ( the busine b. Journalize the adjusting entry for the current year's product warranty expense. Enter your answers in millions. If an amount box does not require an entry, leave it blank c. What two conditions must be met in order for a product warranty liability to be reported in the financial statements?
Harbour Company disclosed estimated product warranty payable for comparative years as follows: Current Year (in millions) $15,520 9,440 $24,960 Current estimated product warranty payable i Noncurrent estimated product warranty payable Prior Year (in millions) $14,880 8,320 $23,200 Total Assume that Harbour's sales were $183,040 million in the current year and that the total paid on warranty claims during the current year was $16,000 million. a. The distinction between short and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash relative to the quick current assets and other longer-term ( the busine b. Journalize the adjusting entry for the current year's product warranty expense. Enter your answers in millions. If an amount box does not require an entry, leave it blank c. What two conditions must be met in order for a product warranty liability to be reported in the financial statements?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Harbour Company disclosed estimated product warranty payable for comparative years as follows:
Current Year Prior Year
(in millions)
(in millions)
$15,520
9,440
$24,960
Current estimated product warranty payable
Noncurrent estimated product warranty payable
$14,880
8,320
Total
$23,200
Assume that Harbour's sales were $183,040 million in the current year and that the total paid on warranty claims during the current year was $16,000 million.
a. The distinction between short and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash
relative to the quick current assets and other longer-term (
the business
b. Journalize the adjusting entry for the current year's product warranty expense. Enter your answers in millions. If an amount box does not require an entry, leave it
blank
c. What two conditions must be met in order for a product warranty liability to be reported in the financial statements?
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