Under U.S.GAAP, the cost of a product warranty should be included as an expense in the

Question

Quizplus · Accepted Answer

The cost of a product warranty should be recognized as an expense in the period of the sale of the product, as it is an obligation to provide a warranty that arises from the sale transaction. This is consistent with the matching principle of accounting, which requires that expenses should be recognized in the same period as the revenue they help to generate.

Under USGAAP, the Cost of a Product Warranty Should Be Included