Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 16 - No. 14)
Which of the following best describes the matching principle?
Assets should be matched with liabilities.
Revenues should be matched with expenses in the same accounting period.
Debits should always equal credits.
Expenses should be matched with assets.
Explanation
The matching principle dictates that expenses should be recognized in the same accounting period as the revenues they helped generate.
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