Explain the matching concept with example ?
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ᴛʜᴇ ᴍᴀᴛᴄʜɪɴɢ ᴘʀɪɴᴄɪᴘʟᴇ sᴛᴀᴛᴇs ᴛʜᴀᴛ ᴇxᴘᴇɴsᴇs sʜᴏᴜʟᴅ ʙᴇ ʀᴇᴄᴏɢɴɪᴢᴇᴅ ᴀɴᴅ ʀᴇᴄᴏʀᴅᴇᴅ ᴡʜᴇɴ ᴛʜᴏsᴇ ᴇxᴘᴇɴsᴇs ᴄᴀɴ ʙᴇ ᴍᴀᴛᴄʜᴇᴅ ᴡɪᴛʜ ᴛʜᴇ ʀᴇᴠᴇɴᴜᴇs ᴛʜᴏsᴇ ᴇxᴘᴇɴsᴇs ʜᴇʟᴘᴇᴅ ᴛᴏ ɢᴇɴᴇʀᴀᴛᴇ. ɪɴ ᴏᴛʜᴇʀ ᴡᴏʀᴅs, ᴇxᴘᴇɴsᴇs sʜᴏᴜʟᴅɴ'ᴛ ʙᴇ ʀᴇᴄᴏʀᴅᴇᴅ ᴡʜᴇɴ ᴛʜᴇʏ ᴀʀᴇ ᴘᴀɪᴅ. ... ᴀᴅᴍɪɴɪsᴛʀᴀᴛɪᴠᴇ sᴀʟᴀʀɪᴇs, ғᴏʀ ᴇxᴀᴍᴘʟᴇ, ᴄᴀɴɴᴏᴛ ʙᴇ ᴍᴀᴛᴄʜᴇᴅ ᴛᴏ ᴀɴʏ sᴘᴇᴄɪғɪᴄ ʀᴇᴠᴇɴᴜᴇ sᴛʀᴇᴀᴍ.
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Explain the matching concept with example ?
The matching principle states that expenses should be recognized and recorded when those expenses can be matched with the revenues those expenses helped to generate. In other words, expenses shouldn't be recorded when they are paid. ... Administrative salaries, for example, cannot be matched to any specific revenue stream.
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