The Expense Recognition Principle Requires the Recognition of Expenses

question 12

Multiple Choice

The expense recognition principle requires the recognition of expenses:

• A)in the same period in which the related revenues are earned.
• B)in the period they are paid.
• C)in the period assets are created.
• D)in the period in which future benefit for the company occurs.

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Definitions:

Critical Value

A point on the scale of the test statistic beyond which the hypothesis is rejected.

Null Hypothesis

A hypothesis that there is no significant difference or effect, serving as the default assumption to be tested in statistical hypothesis testing.

One-Tailed Test

A statistical test in which the region of rejection is on only one side of the sampling distribution, used when making a directional hypothesis about a population parameter.