The accounting principle that governs the recording of bad debt expense in the same period as sales revenue is called the:
A)expense recognition principle ("matching").
B)time period assumption.
C)revenue recognition principle.
D)separate entity assumption.

Question

Quizplus · Accepted Answer

The expense recognition principle,or "matching" principle governs the recording of expenses and the related revenues so they both are reported in the same period on the income statement.This principle will lead to less distorted views of net income in the period of the sale as well as the period of the bad debt expense.

The Accounting Principle That Governs the Recording of Bad Debt