Which of the following best describes the expense matching principle?
A) It requires expenses to be recorded when they are paid for.
B) It requires expenses to be recorded when incurred to generate revenues.
C)It requires expenses to be recorded consistent with the cash basis of accounting.
D)It does not allow expenses to be recorded if they are incurred prior to being paiD.The matching principle requires that expenses be recorded when incurred in earning revenue.

Question

Quizplus · Accepted Answer

The expense matching principle requires expenses to be recorded when they are incurred in order to generate revenue. This means that the expenses should be matched with the revenue they help generate, even if they are not paid for immediately or at the same time as the revenue is earned. This principle is used to ensure that financial statements accurately reflect the company's performance and profitability over a certain period of time.

Which of the Following Best Describes the Expense Matching Principle