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from the answer for Q3(a)
“An entity accounts for a warranty as a cost accrual if it is not sold separately unless the warranty is to provide the customer with a service in addition to assurance that the product complies with agreed specifications.”
what does it mean by ‘cost accrual’?“Thus the maintenance contract and additional warranty will be recognised over time and the sale of the wind turbine and free warranty will be recognised at a point in time”
what should i recognise the free warranty as? also, at what amount?
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