What do you understand by matching concept in accounting?
Asked by Topperlearning User | 9th Jun, 2016, 12:29: PM
Expenses incurred in an accounting period matched with the revenues during that period is called matching concept. It refers that revenues and expenses incurred to earn these revenue must belong to the one particular accounting period. For example, salary for the month of February, 2016 is paid in April, 2016 and this is recorded in the Profit and Loss A/c for the financial year end, March, 2016 and not in the year when it is realised. Goods purchased or produced are not recorded but costs of goods sold are recorded in the accounting period. Hence, the cost of unsold goods should be deducted from the cost of goods produced or purchased.
Answered by | 9th Jun, 2016, 02:29: PM
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