Corning case - Chris Burnett Intermediate Financial...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Chris Burnett Intermediate Financial Accounting II January 20, 2010 Corning, Inc. Case Concepts c. From the perspective of a Corning customer, a product warranty should be considered an asset, in most cases included in the purchase price, that guarantees the performance of Corning’s product. From Corning’s perspective, a product warranty is a liability that represents a potential claim against the company’s assets if something were to go wrong with a Corning product. d. Management needs to make judgments concerning what estimates to use for anticipating potential warranty related expenses. These estimates may be calculated by evaluating historical data or industry averages. Process e. i. Current portion of long-term debt: This current liability represents the amount of long-term debt that must be repaid within the next year. Accounts payable: Accounts payable are current obligations to another entity as the result of purchases on account. Wages and employee benefits: This current accrued liability represents the amount that remains to be paid to employees for the services that they have performed by the time that the financial statement was produced. Asbestos settlement: This liability has been classified as a current liability because it is a “due on demand” obligation. Although this liability may not be redeemed during the coming year, the possibility that it will be demanded forces the company to record it as a current liability. Income taxes: This current liability represents the amount due to the federal government as a
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

Corning case - Chris Burnett Intermediate Financial...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online