Estimating and Recording Product Warranty Expense in the Period of the Sale

question 149

Multiple Choice

Estimating and recording product warranty expense in the period of the sale best follows the

• A) cost concept
• B) business entity concept
• C) matching concept
• D) materiality concept

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Definitions:

Linear Relationship

A relationship between two variables where the change in one variable is directly proportional to the change in another variable.

Pearson Correlation

A statistical measure that calculates the strength and direction of a linear relationship between two quantitative variables.

Covariance

A measure that indicates the extent to which two variables change together; if the greater values of one variable mainly correspond with the greater values of the other variable, and the same holds for the lesser values.

Reject Null Hypothesis

To conclude, based on statistical analysis, that there is enough evidence to support the alternative hypothesis over the null hypothesis in a study.