Which of the Following Is a Contingency That Would Most

question 117

Multiple Choice

Which of the following is a contingency that would most likely require accrual?

• A)Potential losses from extended warranties.
• B)Customer premium offers.
• C)Potential liability on a product where none have yet been sold.
• D)Sales tax payable.

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Definitions:

Chassis Grease

A lubricant used on various parts of a vehicle's chassis to reduce friction and prevent wear.

Penetrating Oil

A low-viscosity oil designed to penetrate tight spaces and loosen rusted or frozen parts.

Cloud Point

The temperature at which some of the fractions in a diesel fuel begin to wax (solidify) and the fuel takes on an opaque appearance. This can cause problems in the fuel subsystem by plugging filters, resulting in engine shutdown. Most diesel fuel conditioners contain cloud point and pour point depressants.

Wax Crystals

Solid crystalline substances formed in some oils and fats that can cause blockages in fuel systems or cloud the appearance of liquids at lower temperatures.