All of the Following Statements Related to Recording Warranty Expense

question 62

Multiple Choice

All of the following statements related to recording warranty expense are True except:

• A) Recording estimated warranty expense complies with the full disclosure principle.
• B) Warranty expense should be recorded in the period when the warranty service is performed.
• C) Recording estimated warranty expense complies with the matching principle.
• D) The seller reports a warranty obligation as a liability.
• E) Warranty costs are probable and the amount can be estimated.

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