Harbour Company disclosed estimated product warranty payable for comparative years as follows: (in millions) Current Year Prior Year Current estimated product warranty payable $11,201 $10,739 Noncurrent estimated product warranty payable 6,813 6,004 Total $18,014 $16,743 Assume that Harbour's sales were $132,098 million in current Year and that the total paid on warranty claims during the current year was $11,547 million. a. The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash the business relative to the quick current assets and other longer-term . b. Provide the journal entry for the current Year product warranty expense. Enter your answers in millions. If an amount box does not require an entry, leave it blank. Product Warranty Expense Product Warranty Payable 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: (in millions) Current Year Prior Year Current estimated product warranty payable $11,201 $10,739 Noncurrent estimated product warranty payable 6,813 6,004 Total $18,014 $16,743 Assume that Harbour's sales were $132,098 million in current Year and that the total paid on warranty claims during the current year was $11,547 million. a. The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash the business relative to the quick current assets and other longer-term . b. Provide the journal entry for the current Year product warranty expense. Enter your answers in millions. If an amount box does not require an entry, leave it blank. Product Warranty Expense Product Warranty Payable 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
Problem 1Q
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Harbour Company disclosed estimated product warranty payable for comparative years as follows:
(in millions) Current Year Prior Year Current estimated product warranty payable $11,201 $10,739 Noncurrent estimated product warranty payable 6,813 6,004 Total $18,014 $16,743 Assume that Harbour's sales were $132,098 million in current Year and that the total paid on warranty claims during the current year was $11,547 million.
a. The distinction between short- and long-term liabilities is important to creditors in order to accurately evaluate the near-term cash the business relative to the quick current assets and other longer-term .
b. Provide the
journal entry for the current Year product warranty expense. Enter your answers in millions. If an amount box does not require an entry, leave it blank.Product Warranty Expense Product Warranty Payable 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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