Which of the Following Accounting Principles Prescribes That a Company

question 229

Multiple Choice

Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported?

• A)Going-concern assumption.
• B)Expense recognition (Matching)principle.
• C)Measurement (Cost)principle.
• D)Business entity assumption.
• E)Consideration assumption.

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Definitions:

Variable Costs

Costs that vary directly with the level of production or sales, such as materials and labor.

Total Cost

The sum of all costs incurred by a business in producing a good or service, including both fixed and variable costs.

Output

The total quantity of goods or services produced by a company or an economy.

Average Total Cost

The total cost of production divided by the number of units produced, representing the per-unit cost of production including both fixed and variable costs.