Which of the following accounting principles requires that warranty expenses must be estimated and recognized in the same period as the related sales revenue is recognized?
A) The matching principle
B) The disclosure principle
C) The revenue principle
D) The consistency principle

Question

Quizplus · Accepted Answer

The matching principle requires that expenses must be recognized in the same period as the related revenue is recognized. Since warranty expenses are related to sales revenue, they must be estimated and recognized in the same period as the related sales revenue is recognized.

Which of the Following Accounting Principles Requires That Warranty Expenses