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Under US GAAP, the low end of the range would be accrued, and the range disclosed. For example, Sierra Sports has a one-year warranty on part repairs and replacements for a soccer goal they sell. Sierra Sports notices that some of its soccer goals have rusted screws that require replacement, but they have already sold …

Contingent Liabilities Financial Accounting Leggi altro »

There are sometimes significant risks that are simply not in the liability section of the balance sheet. Most recognized contingencies are those meeting the rather strict criteria of “probable” and “reasonably estimable.” a contingent liability that is probable and for which the dollar amount can be estimated should be One exception occurs for contingencies assumed …

12 3 Define and Apply Accounting Treatment for Contingent Liabilities Principles of Accounting, Volume 1: Financial Accounting Leggi altro »