EE 53_Warranties, Liabilities, Patents, Bids, and Insurance.pdf

Warranties, Liabilities, Patents, Bids, and Insurance - 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 writt...

Warranties, Liabilities, Patents, Bids, and Insurance - 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. 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 extended 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 the seller. -A warranty period is the period of time that warrant 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. - a formal promise 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. - A warranty is “a promise or guarantee given.” - A warranty is usually a written guarantee for a product, and it holds the maker of the product responsible to repair or replace a defective product or its parts. Basically, it's the promise included in the formal (and legal) warranty. - Many products, such as electrical goods, are offered with a manufacturer's guarantee or sold with a manufacturer's warranty that often lasts for one year. - Guarantees and warranties are a contract between you and the manufacturer, and the manufacturer must do whatever it says it will do in them. -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 bought the goods, details of what the problem is. - 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, accounts 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 loan value amount, along with interest or other finance charges. Accounts payable is money owed 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. -Current liabilities (short-term liabilities) are liabilities that are due and payable within one year. -Examples of current liabilities : Accounts payable, interest payable, income tax payable, bills payable, bank account overdrafts, 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. -an amount of money borrowed by one party from another. -used by many corporations and individuals as a method of making large purchases that they could not afford under normal circumstances. -A debt 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. In the language of business, the terms "debt" and "liabilities" get thrown around as if they're the same thing. The debt refers to borrowed money, the liabilities are obligations of any kind. All debts are liabilities, but not all liabilities are debts. -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. -Government agencies typically handle and approve applications for patents -Before making a formal application, an applicant should research the Patent and Trademark Office's database to see if another person or institution has claimed a patent for a similar invention. -The invention must be different from or an improvement upon a previous design to be considered for a patent. -It is important for applicants to maintain careful records of the design process and the steps taken to create the invention. - Enforcing the patent is up to the person or entity that applied for the patent. · 1. Utility Patents -Though the definitions are broad, utility patents cover machines,processes, methods, compositions and anything manufactured that has a useful and specific function. -In US, 90 percent of all patents are utility patents, which protect the utility or functional aspects of an invention. - Utility patents are granted for 20 years from the date that the patent application was filed. In addition to the initial patent filing fees, inventors must submit maintenance fees throughout the life of the patent in order to keep the patent’s protection. - It prevents others from manufacturing, selling, using or distributing your invention. 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. -A design patent is good for 14 years from the date the patent was granted. -Unlike utility patents, there are no maintenance fees -The protection is only for its aesthetics and not its function. -A design patent can’t be granted if a similar design exists, and it doesn’t not have to be an exact copy, but must be very similar. 3. 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 The last three patent types are encountered infrequently and are only appropriate in limited circumstances are the following: 1. Reissue Patents, 2. Defensive Publications, and 3. Statutory Invention Registrations. - 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.  Highest Bid Buyer’s Bid Interest Rate Bid Property Interest Bid - 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. Insurance is a means of protection from financial loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. -An entity which provides insurance is known as an insurer, insurance company, or insurance carrier carrier. - A person or entity who buys insurance is known as an insured or policyholder. policyholder The insured receives a contract, contract called the insurance policy policy, which details the conditions and circumstances under which the insured will be financially compensated. -The amount of money charged by the insurer to the insured for the coverage set forth in the insurance policy is called the premium. · 1. Life Insurance – the greatest factor in having a life insurance is for those you leave behind. Two basic types of life insurance : I. Traditional whole life is a policy you pay on until you die, and II. 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. - Philippine Health Insurance Corporation (PhilHealth) was created in 1995 to implement universal health coverage in the Philippines. Its stated goal is to ensure a sustainable national health insurance program for all. · 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. Other Insurances: 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. 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. 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.