Question

The principle or assumption dictating that expenses be matched with revenues is the...

A) revenue recognition principle.
B) expense recognition principle.
C) historical cost assumption.
D) periodicity principle.

Answer 1

The expense recognition principle, also known as the matching principle, states that expenses incurred in generating revenue should be recognized and recorded in the same accounting period as the revenue they help generate.

Step-by-step explanation:

The correct answer to the question is B) expense recognition principle.

The expense recognition principle, also known as the matching principle, states that expenses incurred in generating revenue should be recognized and recorded in the same accounting period as the revenue they help generate.

This principle ensures that financial statements accurately reflect the relationship between revenues and expenses.