Question

Depreciation is an example of which expense recognition

principle? a. association of cause and effect b. systematic and
rational allocation c. cost recovery d. immediate recognition

Answer 1

Answer: B) Systematic and Rational Allocation

Explanation: Depreciation of an Asset is applied on the financial statements of the Company which means the Depreciation reported by the Company in its financial records should differ from that of Depreciation reported in the Taxation Filling of the same by the company.