The expense recognition principle recognizes expenses in the same period in which any related revenues are earned.

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The expense recognition principle, also known as the matching principle, requires that expenses be recognized in the same period in which any related revenues are earned. This helps to ensure that financial statements accurately reflect the costs associated with generating revenue in a given accounting period. By matching expenses with revenues, the principle helps to give a more accurate picture of a company's profitability and financial health over time.

The Expense Recognition Principle Recognizes Expenses in the Same Period