Which of the following is a TRUE statement regarding expenses?

Question

Quizplus · Accepted Answer

The expense recognition principle recognizes expenses in the same period in which the related revenues are earned. This principle is also known as the matching principle, which ensures that expenses are recognized in the same accounting period as the revenue they helped generate. Option A is incorrect as expenses represent past benefits, not future benefits. Option C is incorrect as certain expenses can result in the creation of liability accounts, such as accrued expenses. Option D is incorrect as the critical event for recording salary expense is the employee's performance of the work, not the payment of cash.

Which of the Following Is a TRUE Statement Regarding Expenses