A Warranty Provided When a Customer Exercises an Option to Purchase

A warranty provided when a customer exercises an option to purchase a warranty is recorded as

A) an expense in the period the goods or services are sold.
B) a warranty liability for all costs incurred after sale due to correction of defects.
C) revenue in the period that the service-type warranty is in effect.
D) an assurance type warranty which is included in the sales price of the product.