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:

Inventory Control

The management of inventory levels to ensure that the right amount of stock is available at the right time and place, minimizing costs and meeting customer demand.

MAD

Mean Absolute Deviation, a statistic that measures the average absolute deviation of observed values from their mean.

MSE

Mean Squared Error (MSE) is a measure used in statistics to quantify the average of the squares of the errors or deviations between estimated and actual values.

MAPE

Mean Absolute Percentage Error, a measure used to assess the accuracy of forecast models by calculating the average absolute percent error between predicted and observed values.