Recording estimated product warranty expense in the year of the sale best follows which of the following accounting principles?
A)Matching
B)Consistency
C)Historical cost
D)Full disclosure

Question

Quizplus · Accepted Answer

The accounting principle of matching requires that expenses be recognized in the same period as the revenues they helped to generate. Recording estimated product warranty expense in the year of the sale ensures that the expense is matched to the revenue earned in the same period.

Recording Estimated Product Warranty Expense in the Year of the Sale