When should an expenditure be recorded as an asset rather than an expense?

Question

Quizplus · Accepted Answer

An expenditure should be recorded as an asset rather than an expense when it is expected to provide future economic benefit, such as when it is likely to be used over several accounting periods or when it will generate revenue in the future. This is in accordance with the matching principle in accounting, which requires that expenses be matched with the revenue they generate.

When Should an Expenditure Be Recorded as an Asset Rather