The expense recognition principle is a requirement under accrual accounting to record expenses
A)in the same period as the revenues they generate,not necessarily the period when cash is paid.
B)in the same period in which cash is paid,not necessarily the period as the revenues they generate.
C)only as an adjusting entry when needed.
D)None of the choices are correct.

Question

Quizplus · Accepted Answer

The expense recognition principle requires that expenses should be recorded in the same period as the revenues they generate, not necessarily the period when cash is paid. This ensures that the financial statements accurately reflect the matching of expenses with the revenues they helped generate.

The Expense Recognition Principle Is a Requirement Under Accrual Accounting