Which principle governs the accounting for interim MCQ:Which principle governs the accounting for interim period warranty costs?a) Record only actual claims paidb) Base on quarterly sales onlyc) Defer all costs to year-endd) Estimate annual rate and pro-rate

Explanation of Warranty Costs: Warranty costs represent the estimated expenses a company expects to…

Answered: MCQ: Which principle governs the…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

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Chapter12: Current Liabilities

Section: Chapter Questions

Problem 13MC: Which of the following is not a characteristic of a short-term note payable? A. Payment is due in...

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MCQ: GENERAL ACCOUNTING
2. Which of the following best describes the accounting for assurance-type warranty costs? * 1 point a. Expensed when paid. b. Expensed when warranty claims are certain. c. Expensed based on estimate in year of sale. d. Expensed when incurred.
Warranty expenses result when a company sells products then estimates the units and cost per unit for repairs and replacements that may occur during the warranty period. True False
1.Making insurancepayments in advance is an example of: An accrued revenue transaction. An accrued expense transaction. A deferred revenue transaction. A deferred expense transaction. Question 2. 2.In its 2004 annualreport, Apple Computer reported the following in one of its disclosurenotes: “Warranty Expense: The Company provides currently for theestimated cost for product warranties at the time the related revenue isrecognized.” This note exemplifies Apple’s use of: Conservatism The matching principle Realization principle Full disclosure principle Question 3. 3.The purpose ofclosing entries is to transfer: Accounts receivable to retained earnings when an account is fully paid. Balances in temporary accounts to a permanentaccount. Inventory to cost of goods sold when merchandise is sold. Assets and liabilities when operations are discontinued. Question 4. 4.The best argumentin support of historical cost information is: Relevance. Predictive quality for future cash flows.…
Identify the types of information that can readily be deter-mined from an amortization table for an installment loan. (More than one answer may be correct.)a. Interest expense on this liability for the current year. b. The present value of the future payments under chang-ing market conditions. c. The unpaid balance remaining after each payment.d. The portion of the unpaid balance that is a currentliability.
Access the FASB Accounting Standards Codification at the FASB website (www.fasb.org).Required:Determine the specific citation for accounting for each of the following items:1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed.2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities.3. Accounting for the revenue from separately priced extended warranty contracts.4. The criteria to determine if an employer must accrue a liability for vacation pay
Access the FASB Accounting Standards Codification at the FASB website ( asc.fasb.org ) Required: Determine the specific citation for accounting for each of the following items: 1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed. 2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities. 3. Accounting for the revenue from separately priced extended warranty contracts. 4. The criteria to determine if an employer must accrue a liability for vacation pay.
19. Which of the following best describes the accounting for assurance-type warranty costs? * a. Expensed when paid. b. Expensed when warranty claims are certain. c. Expensed based on estimate in year of sale. d. Expensed when incurred.
15. The expense warranty accrual method a. violates the matching conceptb. requires recognition in the period of sale of the estimated warranty expense and warrantyliabilityc. separates accounting for two components of the sales price: the price of the product andthe price of the warrantyd. debits warranty costs to expense in the period when warranty expenditures are made
A short-term note payable: O Is a written promise to pay a specified amount on a definite future date within one year or the company's operating cycle, whichever is longer O Is a contingent liability O Is an estimated liability O Is not a liability until the due date O Cannot be used to extend the payment period for an account payable
Which of the following is not a characteristic of a short-term note payable? A. Payment is due in less than a year. B. It bears interest. C. It can result from an accounts payable conversion. D. It is reported on the balance sheet under noncurrent liabilities.
Which of the following is an account used in applying the Sales Warranty Approach, but not the Expense Warranty Approach? Select one: O a Estimated liability under warranties Ob. Warranty Expense Oc Unearned Warranty Revenue O d. Prepaid Warranty Expense

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MCQ: Which principle governs the accounting for interim period warranty costs? a) Record only actual claims paid b) Base on quarterly sales only c) Defer all costs to year-end d) Estimate annual rate and pro-rate