The matching principle requires that retirement benefit expenses be recorded in the year the employees receive the retirement checks.

Question

Quizplus · Accepted Answer

The matching principle states that expenses should be matched with the revenues they help to generate. Retirement benefit expenses should be recorded in the years in which employees earn those benefits through their work, not necessarily when the retirement checks are issued. This may involve estimating future retirement benefit expenses and accruing them in the appropriate periods.

The Matching Principle Requires That Retirement Benefit Expenses Be Recorded