Group6_Warranties, Liabilities, Patent, Bids, Insurance

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Warranties, Liabilities,

Patents, Bids, and


Insurances
A warranty is a written statement that promises the
good condition of a product and states that the maker is
responsible for repairing or replacing the product usually
for certain period of time after its purchase.

Usually a written guarantee of the integrity of a product


and of the maker’s responsibility for the repair or
replacement of defective parts.
Types of Warranty
1) Implied Warranty- an implied warranty is a presumed
assurance in product sales. The assurance is treated as a
warranty whether or not the product seller has given
assurances of the same either in writing or even orally.
Under implied warranty there are several other warranty
types including the following:
a) Warranty of Merchantability
b) Warranty of Fitness For A Particular Purpose
c) Warranty of Title
d) Warranty of Habitability
2) Extended Warranty- also called service agreement, an
extend warranty is usually offered to customers on top of
the standard warranty that is issued on new products, it is
also known as “Vehicle Service Contract”. It can be offered
by a retailer, manufacturer or warranty administrator.

This type of warranty is prolonged in nature and is a bit


more costly. From time to time, multiple years extended
warranties have it in writing that for the duration of the
first year of the warranty, in the event that a product is
defective, customers must deal with the producer and not
Warranty Period
A warranty period is the period of time that warranty free repair
and adjustment services in case of a malfunction occurred under
normal use that has followed instruction manuals. The period
varies according to manufacturers, retailers, and products.
Guarantee
A guarantee is a formal promises or assurance (typically in
writing) that certain conditions will be fulfilled, especially that a
product will be repaired or replaced if not of a specified quality
and durability.
What is difference between guarantee
and warranty?
Do all products have a
warranty?
How do I claim warranty?
If you can’t find the guarantee or warranty, contact the
seller or trader and ask if they have a copy or the
manufacturer’s contact details. When you make a claim,
you’ll usually need: proof of purchase – usually a receipt
showing where and when you brought the goods, details
of what the problem is.
LIABILITIES
Liabilities are defined as a company’s legal financial
debts or obligations that arise during the course of
business operations. Liabilities are settled over time
through the transfer of economic benefits including
money, goods, or services.

It include loans, account payable, mortgages, and


deferred revenues.
A loan is money, property or other material goods
given to another party in exchange for future repayment
of the load value amount, along with interest or other
finance charges.

Accounts payable is money owned by a business to its


suppliers shown as a liability on a company’s balance
sheet
A mortgages is a debt instrument, secured by the
collateral of specified real estate property, that the
borrower is obliged to pay back with a predetermined set
of payments.

Deferred revenue, also known as “unearned revenue”,


refers to advance payments a company receives for
products or services that are to be delivered or
performed in the future.
Classification of liabilities
Current liabilities (short-term liabilities) - are liabilities that are
due and payable within one year.

• Example of current liabilities:


• accounts payable, interest payable, income tax payable,
bills payable, bank account overdraft, accrued expenses,
and short-term loans.
Non-current liabilities (long-term liabilities) - are liabilities that are
due after a year or more.

• Examples of non-current liabilities:


• Bonds payable, long-term notes payable, deferred tax
liabilities, mortgage payable, and capital lease.

Contingent liabilities are liabilities that may or may not arise


depending on a certain event.

• Examples of contingent liabilities:


• lawsuits and product warranties.
Debt
A dept arrangement gives the borrowing party permission to
borrow money under the condition that it is to be paid back at
a later date, usually with interest.

Dept is used by many corporations and individuals as a


method of making large purchases that they could not afford
under normal circumstances.
Difference between liabilities and
dept:
In the language of business, the terms “dept” and
“liabilities” get thrown around as if they’re the same
thing. The dept refers to borrowed money, the liabilities
to an obligation of any kind. All depts are liabilities, but
not all liabilities are depts.
PATENTS
A patent is the granting of a property right by a
sovereign authority to an inventor.This grant provides
the inventor exclusive rights to the patented process,
design, or invention for a designated period in exchange
for a comprehensive disclosure of the invention.
Three Types of Patents
1. Utility Patents
 According to the USTPO, 90 percent of all patents are utility
patents, which protect the utility or functional aspects of an
invention. Though the definitions are broad, utility patents
cover machines, processes, methods, compositions and
anything manufactured that has a useful and specific function.
 It prevents others from manufacturing, selling, using or
distributing your invention, and once you’ve been filed for a
utility patent, your invention will have immediate “patent
pending” status, which acts as a disclaimer until the patent
has formally issued.
2. Design Patents
While a utility patent protects the utility or function of a
product, a design patent protects its aesthetic
appearance. Design patents can be issued for the
appearance, design, shape or general ornamentation of
an invention.

Unlike utility patents, there are no maintenance fees


associated with a design patent, and the patent is
sustained without question once it is issued. A design
patent prevents others from using, selling or
manufacturing the appearance of your product.
3. Plant Patents
It is possible to invent or discover a new and distinctive
plant, and patent protection can be sought via a plant
patents. A new and distinct asexually reproduce plant
that is invented or discovered can be patent protected.
This includes plants that are cultivated sports, mutants,
hybrids, transformed plants, newly found seedlings,
algae or macro fungi, but not a tuber propagated plant.
Plant patents have a duration of 20 years from the
effective filing date of the corresponding patent
application.
BIDS
A bid is an offer made by an investor, trader, or dealer
in an effort to buy a security, commodity, or currency. A
bid stipulates the price the potential buyer is willing to
pay, as well as the quantity he or she will purchase, for
that proposed price. A bid also refers to the price at
which a market maker is willing to buy a security. But
unlike retail buyers, market makers must also display an
ask price.
The Three Most Common Types of Bids are:
1. Auction Bids
 Buyers who participate in auctions bid against each other in order to
win the asset through an open bidding process. They do so by placing
competitive bids in an attempt to beat out the other buyers. The
person who bids the highest amount wins the auction.

2. Online Bidding
 Online bidding sites work just like traditional auctions. For instance,
someone may be selling a pair of designer sunglasses on eBay and
starts an auction with a minimum price. Interested buyers can bid on
the item with an amount they wish to pay until one person's bid is
accepted by the seller. These sites normally require buyers to set up
accounts and may also require payment card information.
3. Sealed-Bids
Unlike the two types of bids noted above, participants in some
venues aren't privy to how much their competitors are
bidding. This is the case with sealed-bid auctions.

A sealed-bid auction happens when multiple bidders are given


envelopes in which they place their bids. The envelopes are
then sealed so no one bidder can knowingly outbid the other,
making the outcome fair. The highest bidder is the one who
wins. This type of bidding normally takes place for contracts or
real estate sales.
Property Interest Bid
Bidders bid for an interest in the property. The bidder who is
willing to take the smallest portion of undivided interest in the
property will win the tax lien. The idea is to protect the
property owner. If the property owner does not redeem the
tax lien, you can foreclose on your interest in the property.
INSURANCE
Insurance is an agreement in which a person makes regular
payments to a company and the company promises to pay
money if the person is injured or dies, or to pay money equal
to the value of something if it is damaged, lost, or stolen.

Different Kinds of Insurance:


1. Life Insurance – the greatest factor in having a life insurance is
for those you leave behind.
 Two basic types of life insurance:
• Traditional whole life is a policy you pay on until you
die and Term life is a policy for a set amount of time.
2. Health Insurance – helps pay for some of those
unexpected costs, and provides financial protection against
ongoing large medical bills.

3. Long-Term Disability Coverage –an insurance most of us think


we will never need, as none of us assumes we will become
disabled. Disability insurance will guarantee that you will have
some income when you can’t work.
Importance of Insurance:
1. Provide safety and security.
2. Generates financial resources.
3. Life insurance encourages savings.
4. Promotes economic growth.
5. Medical support.
6. Spreading of risk.
7. Source of collecting funds.
Insurance is Not a Gambling:
 The insurance serves indirectly to increase the productivity
of the community by eliminating worry and increasing
initiative. The uncertainty is changed into certainty by
insuring property and life because the insurer promises to
pay a definite sum at damage or death.
Insurance is Not a Charity:
 Charity is given without consideration but insurance is not
possible without premium. It provides security and safety to
an individual and to the society although it is a kind of
business because in consideration of premium it guarantees
the payment of loss. It is a profession because it provides
adequate sources at the time of disasters only by charging a
nominal premium for the service.

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