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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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Chapter
Section
BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

The matching principle in accounting requires the matching of debits and credits.

To determine

Identify whether the given statement is true or false.

Answer

False statement.

Explanation

Matching principle: According to this principle, the expense should be recognized when it is actually incurred, doesn’t matter, payment is made or not. This principle ensures that the expenses incurred in the current period are matched against the revenues earned in the same period. Matching principle is sometimes called as expense recognition principle.

The matching principle helps in matching the revenue earned during the year with the respective expense incurred to produce the revenue.

Therefore, for the given statement “The matching principle in accounting requires the matching of debit and credits” is false.

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