CFA Practice Question

There are 534 practice questions for this study session.

CFA Practice Question

The matching principle ______

A. applies only to situations in which a cash payment occurs before an expense is recognized or a cash receipt occurs before revenue is recognized.
B. is used in accrual accounting to determine the proper period in which to recognize revenue.
C. is used in accrual accounting to determine the proper period for recognition of expenses.
Correct Answer: C

User Contributed Comments 5

User Comment
sunny matching is to find expense. revenue recognition is to find revenue amount.
teddajr match EXPENSE to revenue.
julescruis good answers
bhaynes The matching principal is an expense related concept.
Kevdharr The realization principle is used in accrual accounting to determine the proper period in which to RECOGNIZE REVENUE (choice B) while the matching principle is used in accrual accounting to determine the proper period for RECOGNITION OF EXPENSES (choice C).
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