How Is the Matching Principle Related to the Recording of Depreciation

question 25

Multiple Choice

How is the matching principle related to the recording of depreciation on tangible operational assets?

• A) The matching principle requires a company to use the same depreciation.
• B) Once a depreciation method is adopted for a particular asset, the owner must continue to use the same method.
• C) The accountant who calculates the depreciation may assume that the company will continue in business at least as long as the estimated useful life of the asset.
• D) A portion of the cost of the asset should be allocated as an expense for the periods in which the asset helps the business to earn revenue.

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Definitions:

Conversational Rules

Guidelines that govern the flow and manners of verbal interaction, ensuring coherence and mutual understanding among participants.

Kindergarten Students

Children who attend the first year of school that is aimed at introducing them to the structure and social environment of school.

Abstract Thinking

The ability to consider concepts, possibilities, and ideas that are not immediately visible, tangible, or concrete.

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A stage of cognitive development in Jean Piaget's theory, characterized by the ability to think abstractly, logically, and systematically.