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When do the effects of warranty obligations affect the statement of cash flows? Multiple Choice When the warranty obligation is recognized. When the sale of merchandise is made. None of these answer choices are correct When there is a settlement of a warranty claim made by a customer. Indicate whether each of the following statements is true or false. a) The extension of a warranty on goods sold normal represents a legal obligation to the seller of the goods. b) Recognizing the warranty obligation increases the Warranties Payable account and decreases a revenue account. c) Recording the payment of cash to settle a warranty claim increases expenses (Warranties Expense) and decreases liabilities (Warranties Payable). d) Net income is not affected by the payment of cash to settle a warranty claim. e) Total assets are not affected by the adjustment to record the warranty obligation