Ford Company provides a one-year warranty for its products. For the year 2019, the company estimates to spend Sh. 200,000 in servicing warranty claims.

Required:

i)Ford's journal entry to record the estimated warranty expense

ii) Show adjusting journal entries if actual expenditure incurred in warranty is Sh. 150,000

c) Differentiate between temporary and permanent differences

d) How does the present value relate to the concept of liability

e) Explain by use of examples the difference between accrual, provisions and prepayments