The accounting principle underpinning the practice of providing for doubtful debts is the:
A) matching convention.
B) historical cost convention.
C) dual aspect convention.
D) going concern convention.

Question

Quizplus · Accepted Answer

The matching convention stipulates that expenses incurred should be matched against revenues earned in the relevant accounting period. The practice of providing for doubtful debts is done to ensure that the expenses associated with credit sales are recognized in the same period as the corresponding revenue. This is consistent with the principle of matching.

The Accounting Principle Underpinning the Practice of Providing for Doubtful