Which of the following situations is an example of a proper application of the conservatism principle in accounting?
a) A bakery in a college town believes it could sell more cookies if it stayed open two hours later on weekends, but to be conservative, it decides to start by staying open only one hour later.
b) A tech startup is hiring some contract workers to help with marketing. Although they expect to be able to sell their product internationally, to be conservative, the marketing efforts are focused on domestic customers.
c) A new women's accessories retailer would like to have a 50% gross margin on average. On its opening weekend, it marks all products down 20% to attract customers and be able to exceed its conservative sales estimates.
d) An electronics store includes a warranty with all TV purchases greater than $1,000. To be conservative, the company allocates a portion of these sales to a warranty liability account rather than recording it all as revenue immediately.