Which of the following is NOT a liability that must be estimated?
A) warranties
B) vacation pay
C) bonus plans
D) promissory notes

Question

Quizplus · Accepted Answer

Promissory notes are not a liability that needs to be estimated. This is because promissory notes do not involve any uncertainty or estimation. They are a written promise to pay a specific amount at a specific time, and therefore their value is certain and can be accurately recorded in the financial statements. Warranties, vacation pay, and bonus plans, on the other hand, involve estimation and uncertainty, as their value depends on future events that cannot be predicted with certainty.

Which of the Following Is NOT a Liability That Must