Robert Rogers, CPA, owns a computer that is used in his consultancy services. As per the matching principle, the related account that should appear on the balance sheet as of December 31, 2014 is:
A)Depreciation Expense.
B)Service Revenue.
C)Accumulated Depreciation.
D)Equipment Expense.

Question

Quizplus · Accepted Answer

The matching principle requires that expenses be matched with the related revenues in the same accounting period. While the computer is used to generate service revenue, the related account that should appear on the balance sheet as of December 31, 2014 is Accumulated Depreciation, which reflects the portion of the cost of the computer that has been recognized as an expense over time.

Robert Rogers, CPA, Owns a Computer That Is Used in His