Are all warranty costs accounted for under the accrual basis of accounting? Exploin A. No. If the warranty is an assurance-type warranty and the amount of the repair cost is not subject to reasonable estimation, then the cash basis is used. OB. Yes. U.S. GAAP and IFRS require that all warranty costs be accounted for under the accrual basis of accounting because the warranty costs should be recognized in the year the repairs take place C. Not the warranty is a service-type warranty and the amount of the repair cost is easily estimated, then the cash basis in used OD. Yes. Although neither U.S. GAAP or IFRS require that warranty costs be accounted for under the accrual basis of accounting, most companies agree that using an accrual basis approach is er and loss time consuming