Two accounting principles central to accrual accounting basis that are relied on in the adjusting process are:
A)Revenue recognition and monetary unit.
B)Revenue recognition and going-concern.
C)Expense recognition (matching)and cost.
D)Expense recognition (matching)and business entity.
E)Revenue recognition and Expense recognition (matching).

Question

Quizplus · Accepted Answer

The two accounting principles central to accrual accounting basis that are relied on in the adjusting process are revenue recognition and expense recognition (matching). Revenue recognition refers to recognizing the revenue when it is earned, regardless of whether cash has been received or not. Expense recognition (matching) involves recognizing the expenses in the period in which the related revenue is recognized, in order to match the expenses with the revenue they helped generate. These principles ensure that the financial statements accurately reflect the company's financial performance for the period.

Two Accounting Principles Central to Accrual Accounting Basis That Are