alleryStart learning →Each warranty claim is unlikely, yet some claims across all sales are likely. A provision is:
ARecognised for class
BNot recognised at all
CRecognised per item only
DDisclosed but not booked
Answer & Solution
Correct answer: A. Recognised for class
For many similar obligations the probability of outflow is judged for the class as a whole, so a provision is made if some outflow is probable.
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