Which of the following statements describes the proper matching of revenue and expenses? Multiple Choice Insurance...

Which of the following statements describes the proper matching of revenue and expenses?

Multiple Choice

Insurance premiums cover specific periods and are charged to expense when they are paid.
The cost of a building is recorded as an asset. Depreciation expense is recognized over the periods in which the asset is expected to help earn revenues for the business.
General office salaries are recorded as assets when they are incurred because they benefit future periods.
Manufacturing costs are identified with specific products and are charged to cost of goods sold when the manufacturing process is complete.

Solutions

Expert Solution

answer)The cost of a building is recorded as an asset. Depreciation expense is recognized over the periods in which the asset is expected to help earn revenues for the business.

The calculation of depreciation expense follows the matching principle, which requires that revenues earned in an accounting period be matched with related expenses.

ekkarill92 answered 1 year ago

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