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a. Realization principle b. Materiality principle c. Matching principle d. Depreciation principle
Matching Principle governs the timing of revenue recognition.
Joshi Mathew
Certified Internal Auditor #1036906
c. Matching principle
c
Under this principle revenue is to be recorded when it is realized (or realizable), revenuesare recognized as soon as a product has been sold or a service has been performed, regardless of when the money is actually received.
Under matching principle of the accrual basis of accounting:
Revenues are reported on the income statement when they are earned- before the cash is received from the customers.
