It is an acceptable accounting practice to treat an expenditure that is not material in dollar amount as an expense of the current period even though the expenditure may benefit several periods.

Question

Quizplus · Accepted Answer

This is the concept of materiality in accounting. If an expenditure is not material in amount, it can be expensed in the current period rather than capitalized as an asset and spread out over multiple periods.

It Is an Acceptable Accounting Practice to Treat an Expenditure