The expense recognition principle ("matching")matches:
A) cash receipts with cash disbursements.
B) expenses with the revenues to which they relate.
C) assets with liabilities.
D) prepaid expenses with unearned revenues.

Question

Quizplus · Accepted Answer

The expense recognition principle, also known as the matching principle, dictates that expenses should be matched with the revenues they helped to generate. This means that when revenue is earned, the expenses incurred to generate that revenue should be recognized in the same period. Therefore, option B is the correct answer as it states that expenses should be matched with the revenues they relate to.

The Expense Recognition Principle ("Matching")matches