Which of the Following Statements Is INCORRECT Concerning Warranties

question 21

Multiple Choice

Which of the following statements is INCORRECT concerning warranties?

• A) Using the expense approach, the warranty is provided with the product or service with no additional fee.
• B) Where warranty costs are immaterial or when the warranty period is quite short, the warranty costs may be accounted for using the cash basis.
• C) Using the revenue approach, the warranty is a separate deliverable from the related product or service.
• D) The revenue approach must be used for income tax purposes.

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Definitions:

Chronic Pain

Persistent pain that lasts weeks to years and continues beyond the typical recovery time for an injury or illness.

Arthritic Pain

Pain resulting from inflammation, wear, and tear, or degeneration of joints characteristic of various forms of arthritis.

Dementia

A broad category of brain diseases that cause a long-term and often gradual decrease in the ability to think and remember, affecting daily functioning.

Vocalization

The act of producing sound or speech by manipulating airflow and vocal cords; common in communication.