Which of the following entries would be made because of the matching principle?
A)
$$\begin{array} { | l | l | l | l | }
\hline \text { Cash } & & 1,000 & \
\hline & \text { Service revenue } & & 1,000 \
\hline
\end{array}$$
B)
$$\begin{array} { | l | l | l | l | }
\hline \text { Salary expense } & & 1,000 & \
\hline & \text { Salary payable } & & 1,000 \
\hline
\end{array}$$
C)
$$\begin{array} { | l | l | l | l | }
\hline \text { Accounts receivable } & & 1,000 & \
\hline & \text { Service revenue } & & 1,000 \
\hline
\end{array}$$
D) Both A and B are correct.

Question

Which of the following entries would be made because of the matching principle?
A)
$$\begin{array} { | l | l | l | l | } 
\hline \text { Cash } & & 1,000 & \
\hline & \text { Service revenue } & & 1,000 \
\hline
\end{array}$$
B)
$$\begin{array} { | l | l | l | l | } 
\hline \text { Salary expense } & & 1,000 & \
\hline & \text { Salary payable } & & 1,000 \
\hline
\end{array}$$
C)
$$\begin{array} { | l | l | l | l | } 
\hline \text { Accounts receivable } & & 1,000 & \
\hline & \text { Service revenue } & & 1,000 \
\hline
\end{array}$$
D) Both A and B are correct.

Quizplus · Accepted Answer

The matching principle in accounting states that expenses should be recorded in the period in which they are incurred to generate revenues, regardless of when the payment is made. Entry B matches salary expenses (incurred) with salary payable (obligation to pay), which aligns with the matching principle. Entries A and C involve revenue recognition, not the matching of expenses with revenues.

Which of the Following Entries Would Be Made Because of the Matching