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Abraham Lincoln created the IRS in order to help recover expenses incurred by the Civil War.
False
matching principle
Revenue expenses are those expenses which are incurred for every fiscal year to earn revenue for specific fiscal year and are recurring nature like salaries etc.
It is a listing of all revenue/expenses incurred by the business during a set period. It shows areas of growth and areas that are lagging within the business.
This is the Accrual basis accounting method, which uses the matching principle (expenses following revenue) to record expenses when they are incurred, and revenue when it is earned (not on the date when cash is received or paid out).
All the expenses which a business incurred from start of business to actual start of operations of revenue generating activity of business is called preliminary expenses.
A revenue expenses report is a listing of all expenses an organization incurred during a specified period, usually a month, quarter, or a year. One example of n expense is rent, utilities, etc.
revenue expenditure is recurring in nature. It is incurred to operate day to day expenses. eg salaries and wages, printing and stationery.
It is a listing of all revenue/expenses incurred by the business during a set period. It shows areas of growth and areas that are lagging within the business.
The Matching Concept: A significant relationship exists between revenue and expenses. Expenses are incurred for the for the purpose of producing revenue. In measuring net income for a period, revenue should be offset by all the expenses incurred in producing that revenue. This concept of offsetting expenses against revenue on the basis of "causes and effect" is called the Matching Concept. The term 'matching' means appropriate association of related revenues and expenses. In matching expenses against revenue the question when the payment was made or received is 'irrelevant'. For example if a salesman is paid commission in January, 2001, for sale made by him in December, 2000. According to this concept commission expense should be offset against sales of December 2000 because this expense is incurred for producing revenue in December 2000. On account of this concept, adjustments are made for all outstanding expenses, accrued revenues, prepaid expenses and unearned revenues, etc, while preparing the final accounts at the end of the accounting period.
Net income is negative which means that either company has earn less revenue or have incurred more expenses then revenue earned.