The expense recognition principle matches
A) customers with businesses.
B) expenses with revenues.
C) assets with liabilities.
D) creditors with businesses.

Question

Quizplus · Accepted Answer

The expense recognition principle, also known as the matching principle, states that expenses should be recognized and matched with the revenues they help generate in the same accounting period. This ensures that the financial statements accurately reflect the company's performance and profitability. Matching revenues with expenses is crucial for determining the true profitability of the business. Therefore, the best choice is B, expenses with revenues.

The Expense Recognition Principle Matches