The Matching Principle Requires Businesses to Record Warranty Expense

question 41

Multiple Choice

The matching principle requires businesses to record Warranty Expense:

• A)in the same period that the company records the revenue related to that warranty.
• B)in the period prior to which the company records the revenue related to that warranty.
• C)in the period after the related revenue is recorded.
• D)in the contingent liabilities section of the balance sheet.

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Definitions:

Slope

In mathematics, a measurement of the steepness, incline, or grade of a line, typically expressed as a ratio of vertical change to horizontal change.

Value

The importance or utility that something has for an individual or the market price of a good or service.

Horizontal Axis

In graphing, this is the x-axis, which typically represents the independent variable.

Vertical Axis

In a graph or chart, the vertical line or scale along which numerical data is plotted or measured, usually representing quantities.