A dance studio accepts $1,500 to provide a series of dance lessons to a youth group during the month of July.The studio decides to record the revenue in July.The studio also decides to record the July expenses of rent,utilities and salaries in August,when it pays for them.One or both of these decisions:

Question

Quizplus · Accepted Answer

The decision to record July expenses in August violates the Expense Recognition (Matching) principle, which states that expenses should be recorded in the same period as the revenues they help to generate.

A Dance Studio Accepts $1,500 to Provide a Series of Dance