The balance in the Warranty Liability account is always equal to Warranty Expense.

Name: The balance in the Warranty Liability account is always equal to Warranty Expense.
Brand: Quizplus
Rating: 4.8 (28 reviews)

Question

Quizplus · Accepted Answer

The warranty liability account represents the estimated cost of future warranty claims, whereas the warranty expense account represents the actual cost of warranty claims incurred during the current period. Therefore, the balance in the warranty liability account is not always equal to the warranty expense.

The Balance in the Warranty Liability Account Is Always Equal