SERVICE CONTRACT Definition

Bookmark and Share

SERVICE CONTRACT is a contract offered by a retailer for maintaining and repairing a product beyond its manufacturers warranty coverage.

Learn new Accounting Terms

PRACTICAL CAPACITY is where the cost of production is based on the practical capacity of production facilities. Therefore, the proportion of overheads allocated to a unit of production is not to be increased as consequence of idle capacity of the plant.

DEFEASANCE is a. the release of a debtor from the primary obligation for a debt. A legal defeasance could take place in absolute terms, i.e., the debt could cease to exist for anyone (by being forgiven or set aside), or the creditor could formally recognize that another party has taken over the primary obligation for the debt; and, b. in securities, a technique used by bond issuers to dis­charge old, low-rate debt by purchasing a smaller amount of higher-yielding U.S. Treasury debt. The Treasuries are held in trust to service the old debt being retired.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.