Input formula warranty easily

Aug 6th, 2022
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How to input formula warranty

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in this video were going to talk about how to accrue warranty expense in the financial statements so first of all its a good idea to have an understanding what warranty means and basically were talking about some kind of guarantee that a firm is making when you buy the product that there wont be any problems it wont break or if it does theyll actually replace the components that broke or the replace your computer whatever it is that you purchase so its some kind of guarantee about the workmanship so a firm here as you might see if they have a warranty they might have some kind of liability associated with that right because remember a liability is basically an obligation to sacrifice some assets at some point in time so when we have a warranty and we say ok you bought this computer but if it breaks it will replace it well give you another computer well we know theres some kind of obligation here so we have to determine well how do we account for this how do we put this in the

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To estimate the warranty expense for a company, we need to know three main things: Number of units sold during a particular accounting period. Percentage of the sold products that will probably need a repair or a replacement based on previous experiences. Average cost of repairing or replacing products under warranty.
=EDATE(A6,12) We can use the EDATE function to calculate expiration dates by months. EDATE returns the same date and months ahead or before. This will show the expiration dates in column C.
Warranties are classified in two categories: assurance- and service-type. An assurance-type warranty guarantees that the product will function as intended. This type of warranty promises to repair or replace a delivered good or service if it does not perform as expected.
To estimate the warranty expense for a company, we need to know three main things: Number of units sold during a particular accounting period. Percentage of the sold products that will probably need a repair or a replacement based on previous experiences. Average cost of repairing or replacing products under warranty.
By my calculations, a product with a 1 year warranty will be covered for 1 year. 1=1. Or 1 year=12 months=365 days=8760 hours. One with a 90 day warranty will be covered for 90 days.
How to calculate warranty expenses Find the total number of products sold. Determine the percentage of defective products. Calculate the number of products needing replacement. Evaluate the cost of product replacement. Estimate the total warranty expense.
If the items expiration date is n years in the future, you also use the formula EDATE(startdate,month). For instance, the start date is 3/1/2020, the warranty period is 1 year (12 months), use the formula:=EDATE(C6,12).
To calculate years of service using DATEDIF: Click the cell where you want the years of service to appear. Type: =DATEDIF( Click the cell containing the start date, then type a comma. Click the cell containing the end date, type a comma, then type: y) Press Enter and the years of service will calculate.

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