Accruing warranty expense is prescribed by the:
A)recognition criteria for revenues.
B)matching objective.
C)full-disclosure principle.
D)going-concern assumption.

Question

Quizplus · Accepted Answer

The matching objective in accounting requires that expenses be matched with the revenues they help to generate. Accruing warranty expense aligns with this principle, as it involves recognizing the cost of warranties in the same period the related product sales occur, ensuring that the financial statements accurately reflect the company's financial position.

Accruing Warranty Expense Is Prescribed by The