The matching principle requires that:
A)revenues earned and expenses incurred in generating those revenues should be reported in the same income statement.
B)non-operating gains and losses should be netted against each other.
C)a proportion of each dollar collected will be assumed to be a recovery of cost.
D)assets will be matched to the liabilities incurred to purchase them.

Question

Quizplus · Accepted Answer

The matching principle requires that revenues earned and expenses incurred in generating those revenues should be reported in the same income statement. This ensures that the income statement accurately reflects the expenses related to generating revenue in the same period in which the revenue was earned, providing a more accurate picture of the profitability of the business.

The Matching Principle Requires That