One consequence of the revenue-expense approach is to burden the balance sheet with by-products of income measurement rules.

Question

Quizplus · Accepted Answer

The revenue-expense approach focuses on measuring income by subtracting expenses from revenue, which can lead to the inclusion of certain items on the balance sheet, such as prepaid expenses, accrued liabilities, and unearned revenue. These items are not necessarily reflective of the company's financial position or cash flow, but are a result of the way income is measured using this approach.

One Consequence of the Revenue-Expense Approach Is to Burden the Balance