• $LO03-02$ Explain and apply the revenue and expense recognition principles.Skip $to$ question$[The$ following information applies $to$ the questions displayed below.$]$$In$ this module, you will learn that the two key concepts underlying accrual basis accounting and the income statement are revenue recognition principle and expense recognition principle $or$ "matching." The revenue recognition principle recognizes revenues when they are earned $by$ providing goods $or$ services, regardless $of$ when cash $is$ received. The expense recognition principle recognizes expenses when they are incurred $in$ generating revenue, regardless $of$ when cash $is$ paid.Expense Recognition Principle $("Matching")$Access the text alternative for Expense Recognition Principle $(“Matching”).$ Will open $in$ a new tab $or$ window. Internet connection required.Knowledge Check $01$Under accrual basis accounting, which $of$ the following $is$ required $by$ the expense recognition principle?multiple choiceExpenses are deferred until cash $is$ paid.Expenses are recognized $in$ the same period $as$ the revenues $to$ which they relate.Revenues collected $in$ cash should match expenses paid $in$ cash.Revenues are reported when cash $is$ matched.