Sally Smith had expenses of $800 in June which she paid in July. She declared these expenses on her June income statement. By doing this she is following the accounting principle of:

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Sally Smith is following the matching principle, which requires expenses to be recorded in the same period as the revenue they helped to generate. Even though Sally paid the expenses in July, she incurred them in June and they should be recorded in that period. This principle ensures that financial statements accurately reflect the company's performance during a specific period of time.

Sally Smith Had Expenses of $800 in June Which She