In accrualbasis accounting, expenses:
A) must equal the amount of financing provided by the firm's owners.
B) are recognized only when cash is paid.
C) are exempt from taxbased accounting treatment.
D) are matched with the revenues they help generate.

Question

In accrual­basis accounting, expenses:
A) must equal the amount of financing provided by the firm's owners.
B) are recognized only when cash is paid.
C) are exempt from tax­based accounting treatment.
D) are matched with the revenues they help generate.

Quizplus · Accepted Answer

In accrual-basis accounting, expenses are recognized when they are incurred, rather than when they are paid. They are matched with the revenues they help generate, as this provides a more accurate picture of the company's financial performance. This matching principle is a key aspect of accrual-basis accounting.

In Accrual­basis Accounting, Expenses

In Accrualbasis Accounting, Expenses