Which of the following loss contingencies is not usually accrued?
A)product warranty obligations
B)premium offer obligations
C)risk of loss from fire
D)noncollectibility of receivables

Question

Quizplus · Accepted Answer

Loss contingencies that are not probable or the amount cannot be reasonably estimated are not accrued. Risk of loss from fire falls under this category, as it is an uncertain event that may or may not occur, and the amount of loss cannot be reasonably estimated in advance. Product warranty obligations and noncollectibility of receivables are usually accrued if probable and can be reasonably estimated. Premium offer obligations are not usual loss contingencies.

Which of the Following Loss Contingencies Is Not Usually Accrued