Warranties should be accrued if it is
A) probable that an expense will be incurred and the amount is reasonably estimable.
B) possible that an expense will be incurred regardless of whether the amount is estimable or not.
C) possible that an expense will be incurred and the amount is reasonably estimable.
D) remote that any costs will be incurred.

Question

Quizplus · Accepted Answer

Warranties should be accrued when it is probable that an expense will be incurred and the amount can be reasonably estimated, as per accounting principles.

Warranties Should Be Accrued If It Is