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How to classify title warranty

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The video discusses how to accrue warranty expense in financial statements. Warranty is a guarantee by a firm that a product will be replaced or repaired if it breaks. This creates a liability for the firm, as it is an obligation to provide a replacement. The video explores how to account for this liability in the financial statements.

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Which document does the seller use to guarantee the title is good?

A warranty deed is a legal real estate document that protects the buyer and ensures that the seller holds a clear title to the property, has no outstanding liens or mortgages, and there will be no future claim to the title of the property.

What is another name for a warranty deed?

A warranty deed, also known as a general warranty deed, is a legal real estate document between the seller (grantor) and the buyer (grantee).

What is an example of warranty of title?

Warranty of title can give the buyer of a property legal recourse to sue the seller if there is a claim or issue attached to the property. For example, an heir of a prior owner may have an unresolved claim to the property that was not made known by the seller.

What is implied warranty as to title?

An implied warranty is automatically presumed regarding the sale of goods or real property, which prevents a risk from transferring to the buyer. An implied warranty is different from an express warranty, where the seller has expressly promised by words (i.e. orally or in writing) or conduct (e.g., sample or model).

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