The need to create an estimated warranty liability arises from the ________ principle.
A)matching
B)entity
C)conservatism
D)objectivity

Question

Quizplus · Accepted Answer

The matching principle in accounting requires that expenses be matched with the revenues they help to generate. Creating an estimated warranty liability allows for the matching of the expense of the warranty (a future cost) with the revenue from the sale of the product, adhering to this principle.

The Need to Create an Estimated Warranty Liability Arises from the ________