Expenses represent the costs incurred by a company during a period to generate revenue. These costs are reported in the period in which they are incurred to show their impact on the company's financial position. Expenses reduce the company's shareholders' equity by reducing its retained earnings. Therefore, all the given options are correct.

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Expenses

Question 33

Multiple Choice

Expenses

A) represent the costs that arise when a company sacrifices its resources during the accounting period.
B) are reported in the period in which they are incurred to generate revenue.
C) reduce Shareholders' equity.
D) all of the above.

Correct Answer: