(14) Commitments and contingencies:

The Company generally determines its total warranty liability by applying historical claims rate experience to the estimated amount of equipment that has been sold and is still under warranty based on dealer inventories and retail sales. The historical claims rate is primarily determined by a review of five-year claims costs and current quality developments.

The premiums for extended warranties are primarily recognized in income in proportion to the costs expected to be incurred over the contract period. These unamortized extended warranty premiums (deferred revenue) included in the following table totaled $475 million and $444 million at April 29, 2018 and April 30, 2017, respectively.

A reconciliation of the changes in the warranty liability and unearned premiums in millions of dollars follows:


	Three Months Ended				Six Months Ended
	April 29		April 30		April 29		April 30
	2018		2017		2018		2017
Beginning of period balance	$	1,550	$	1,285	$	1,468	$	1,226
Payments		(213)		(167)		(430)		(332)
Amortization of premiums received		(57)		(54)		(113)		(97)
Accruals for warranties		260		238		453		470
Premiums received		65		55		126		95
Acquisitions *						80
Foreign exchange		(14)		8		7		3
End of period balance	$	1,591	$	1,365	$	1,591	$	1,365

* See Note 18.

At April 29, 2018, the Company had approximately $447 million of guarantees issued primarily to banks outside the U.S. and Canada related to third-party receivables for the retail financing of John Deere and Wirtgen equipment. The increase from October 29, 2017 primarily relates to the Wirtgen acquisition. The Company may recover a portion of any required payments incurred under these agreements from repossession of the equipment collateralizing the receivables. At April 29, 2018, the Company had accrued losses of approximately $16 million under these agreements. The maximum remaining term of the receivables guaranteed at April 29, 2018 was approximately eight years.

At April 29, 2018, the Company had commitments of approximately $328 million for the construction and acquisition of property and equipment. The increase from October 29, 2017 primarily relates to the Wirtgen acquisition. Also, at April 29, 2018, the Company had restricted assets of $123 million, primarily as collateral for borrowings and restricted other assets. See Note 11 for additional restricted assets associated with borrowings related to securitizations.

The Company also had other miscellaneous contingent liabilities totaling approximately $85 million at April 29, 2018. The accrued liability for these contingencies was not material at April 29, 2018.

The Company is subject to various unresolved legal actions which arise in the normal course of its business, the most prevalent of which relate to product liability (including asbestos-related liability), retail credit, employment, patent, and trademark matters. The Company believes the reasonably possible range of losses for these unresolved legal actions would not have a material effect on its consolidated financial statements.