Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

3. Accrual Accounting Concepts

Revenue Recognition and Expense Recognition

Financial Accounting

3. Accrual Accounting Concepts

Revenue Recognition and Expense Recognition

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Multiple Choice

Which accounting principle is described by matching revenue earned during the accounting period to related incurred expenses?

The Revenue Recognition Principle

The Matching Principle

The Historical Cost Principle

The Full Disclosure Principle

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Verified step by step guidance

Step 1: Understand the concept of the Matching Principle. It is an accounting principle that requires expenses to be recorded in the same period as the revenues they help generate. This ensures accurate representation of a company's financial performance.

Step 2: Compare the Matching Principle with the Revenue Recognition Principle. The Revenue Recognition Principle focuses on recognizing revenue when it is earned, regardless of when cash is received, while the Matching Principle emphasizes aligning expenses with related revenues.

Step 3: Differentiate the Matching Principle from the Historical Cost Principle. The Historical Cost Principle states that assets should be recorded at their original purchase price, which is unrelated to the timing of revenue and expenses.

Step 4: Contrast the Matching Principle with the Full Disclosure Principle. The Full Disclosure Principle requires all relevant financial information to be disclosed in financial statements, but it does not address the timing of revenue and expenses.

Step 5: Conclude that the Matching Principle is the correct answer because it specifically addresses the alignment of revenue earned with related incurred expenses during the same accounting period.