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    accountant123's Avatar
    accountant123 Posts: 1, Reputation: 1
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    #1

    Aug 18, 2009, 06:07 PM
    Recording Warranty Premiums in a Warranty Adm. Company
    How do I record warranty premiums in an Warranty Administration Company? I think that it should be recorded as a liability to the warranty insurance captive company. Also that any cash receipts for the warranty administration should be recorded as income. Is this correct?
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    #2

    Aug 19, 2009, 12:24 AM

    What does a warranty administration company do?
    ROLCAM's Avatar
    ROLCAM Posts: 1,420, Reputation: 23
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    #3

    Aug 19, 2009, 02:41 AM

    These should NOT be recorded as a liability.
    This an example of CONTINGENT LIABILITIES.
    They should be recorded as NOTES to the
    Balance Sheet.
    Cash Receipts crystallised should be treated as Income.
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