Final Answer:
The statement expenditures are generally recognized when the related liability is incurred is B) False
Step-by-step explanation:
Expenditures are generally recognized when the related liability is settled, not when it is incurred. In accounting, the matching principle dictates that expenses should be recognized in the period when they are incurred and contribute to the generation of revenue, rather than when the liability is initially incurred. This ensures that expenses are properly matched with the revenues they help generate, providing a more accurate representation of an entity's financial performance.
Therefore, the correct statement is False. Expenditures are typically recognized when the related liability is settled, not merely when it is incurred.