microsoft on tthursday extened the warrenty on its xbox 360 video game console and said it will take a charge of more than 1 billion to pay for anticiapted costs under the new warrenty, microsoft will pay for shipping and repairs for 3 years worldwide, for consoles afflicted with what gamers call the red ring of death previously the warrenty expired after a year for US customers and 2 years for european, the charge will be 1.05 billion to 1.15 billion for the quarter ended june 30. microsoft reports its forth quarter results july 19

required

1. why must microsoft report his charge of over 1 billion entirely in one quarter, the last quarter of the companys fiscal year

2. when the annoucement was made, analyst richard doherty stated that either a high number of xbox 360s will fail or the company is being overely conservative in its warrenty estimate, from an accounting standpoint what will micerosoft do in the future if the estimate of future repairs is overly conservative (to high):?Summarize your findings. Cite relevant GAAP.