The Matching Principle Dictates Whether the Cost of a Repair

question 145

True/False

The matching principle dictates whether the cost of a repair should be expensed or depreciated.

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Definitions:

Significant Variances

Large or meaningful differences between planned and actual figures in budgeting or accounting, requiring investigation.

Over Budget

Over budget refers to a situation where actual spending exceeds the planned or allocated amount for a particular budget category.

Budget

An estimate of income and expenditure for a set period of time, often used as a plan for financial operations.

Activity Base

A measure used for allocating costs to cost objects, typically related to the level of activity or volume of goods produced that incurs costs.