Which of the Following Factors Would Be Least Likely to Affect

question 124

Multiple Choice

Which of the following factors would be least likely to affect the estimate of the warranty liability?

• A)Changes in the product.
• B)Changes in the nature of the warranty.
• C)Changes in the sales staff.
• D)Changes in sales volume.

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Definitions:

Material Participant

An individual who is actively involved on a regular, continuous, and substantial basis in the operations of a business, affecting their tax treatment of losses.

Form 6198

An IRS form used by taxpayers to determine the amount of loss from an at-risk activity that is deductible.

IRC

The Internal Revenue Code, which is the comprehensive set of tax laws in the United States governing federal tax obligations.

Active Income/Loss

Income or losses generated from direct business activities or employment, as opposed to passive income from investments.