Insert Quantity Warranty For Free
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Is a warranty an obligation?
Definition of Warranty Obligations. Warranty Obligations means all liabilities and obligations arising out of or relating to the repair, rework, replacement or return of, or any claim for breach of warranty in respect of or refund of the purchase price of, any Business Products.
Is a warranty a performance obligation?
If a warranty, or a part of a warranty, provides a customer with a service in addition to the assurance that the product complies with agreed-upon specifications, the promised service is a performance obligation. Therefore, an entity should allocate the transaction price to the product and the service.
Is warranty a separate performance obligation?
Generally, assurance-type warranties are not considered a separate performance obligation. These types of warranties do not provide an additional good or service to the customer, because the selling entity has effectively provided a guarantee of quality and that the product will meet its agreed-upon specifications.
What is warranty obligation?
Warranty Obligations means all liabilities and obligations arising out of or relating to the repair, rework, replacement or return of, or any claim for breach of warranty in respect of or refund of the purchase price of, any Business Products.
What is a service type warranty?
Service-type warranties those are warranties that provide something additional to the mere assurance, for example they provide some extra services. These warranties give rise to a separate performance obligation, because they provide additional service to the customer, and they are accounted for under IFRS 15.
What is a performance obligation in accounting?
A performance obligation is a promise to provide a distinct good or service to a customer. This is the unit of account for applying the new revenue standard. Goods and services that aren't distinct are bundled together with other goods or services in a contract until a single performance obligation is achieved.
What is a warranty in contract law?
A warranty in contract law is a promise or guarantee from one party to another that the facts are true and reliable. In the case that those facts ever become untrue, the warranty is also a protection to the recipient to cover any losses that may arise.
What is condition and warranty in contract law?
Warranty and condition in contract law refer to specific stipulations set in a contract of sale. Warranty and condition in contract law refer to specific stipulations set in a contract of sale. A contract is an agreement that takes place between two parties to complete a mutual transaction.
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