According to the expense recognition principle in U.S. GAAP, firms recognize expenses when only one requirement is met: an asset has a reduced future benefit or when a liability is incurred or increased without an associated economic benefit.

Question

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The expense recognition principle requires that expenses be recognized in the same period as the revenues they help to generate, not just when an asset's future benefit is reduced or a liability is incurred.

According to the Expense Recognition Principle in U