All of the Following Statements Related to Recording Warranty Expense

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