Concerning Accounting for Warranties, Which of the Following Statements Is

Multiple Choice

Concerning accounting for warranties, which of the following statements is true?

A) The expense warranty accrual method is the only method accepted for federal income tax purposes.
B) The modified cash basis is the most often used method for financial reporting.
C) The sales warranty accrual method uses a percentage of completion approach to warranty revenue recognition.
D) The modified cash basis recognizes warranty expense when cash is received on the sale.