Question

The expense recognition (matching) principle requires that expenses get recorded in the same accounting period as the revenues that are earned as a result of the expenses, not when cash is paid. True or False?

Answer 1

Answer:

True

Explanation:

The above statement true considering the revenue recognition rule, since the revenue recognition rule requires that incomes be earned, there are no unmerited incomes in collection bookkeeping. The coordinating standard requires that costs get recorded in a similar bookkeeping period as the incomes that are earned because of the costs, not when money is paid.