Abstract

The current research discusses the problem of the multiplicity of warranty policies given on second-class products and their reflection in the specificity of building a cost model for each policy that meets its requirements. In addition, there is a relationship between the estimated warranty costs and the warranty policy in according to it so costs can used as a basis for choosing the appropriate policy to ensure second-class products. The aim of this paper is to provide models for estimating warranty costs for alternative policies and to demonstrate the impact of cost model outputs on the rationalization of short-term warranty policy alternatives. A number of conclusions presented, the most important of which is the absence of a one model for estimating the costs of warranty second-class products suitable for application in different entities due to the different warranty policies on the one hand and the specificity of using products and uncertainty factors on the other. Therefore, the research recommends that accountants should be familiar with the skills necessary to build mathematical models to estimate the costs of guarantee and have the ability to analyze the results of those models and guide management to the appropriate alternative that achieves desired objectives.