Recording an expense in order to measure net income is consistent with the expense recognition principle.

Question

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The expense recognition principle, also known as the matching principle, requires companies to record expenses in the same accounting period as the related revenue. This results in a more accurate measurement of net income. By recording expenses properly, companies can match the cost of goods or services sold with the revenue earned from selling those goods or services. This ensures that the financial statements reflect the actual profitability of the business.

Recording an Expense in Order to Measure Net Income Is