The Matching Principle Calls for the Accountant of a Firm

question 28

Multiple Choice

The matching principle calls for the accountant of a firm to:

• A) identify an asset with each liability of the firm.
• B) associate the revenue generated from a sale to the costs or expenses incurred to produce the product.
• C) match each item of inventory with the historical cost at which it was acquired.
• D) None of the above.

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Definitions:

Progressive Tax

A taxation system in which the tax rate increases as the taxable amount or income increases, commonly seen in income tax systems to ensure higher earners contribute a greater proportion of their income.

Regressive Tax

A tax system in which the tax rate decreases as the taxable amount increases, disproportionately affecting lower-income individuals.

Supply-side Economics

An economic theory that advocates reducing taxes and decreasing regulation to stimulate economic growth by increasing supply of goods and services.

Majoritarian Politics

A political philosophy or agenda that asserts the majority's right to make decisions that affect the society, often at the expense of minority opinion or rights.