The Accounting for Warranty Costs Is Based on the

question 7

Multiple Choice

The accounting for warranty costs is based on the

• A) going concern principle.
• B) matching principle.
• C) conservatism principle.
• D) objectivity principle.

---

Definitions:

Legally Binding Contract

An agreement between parties that is enforceable by law.

Acceptance

The act of agreeing to the terms of an offer, contract, or proposal, thereby creating a binding agreement.

Capacity

The legal ability to enter into a binding contract.

Intent

The intended purpose or goal of an action, especially in a contract.