Overview: Accrual Accounting: Revenue Recognition & Matching Principle

Overview:  Accrual accounting:  Revenue Recognition and Matching Principle

The purpose of this module is to help you learn more about accrual accounting's two key principles:

1) the Revenue Recognition principle
2) the Matching Principle

In short, these two principles help users decide in what accounting period they should recognize and report revenues and expenses.  As you move along, you will see that the deciding factor as to when revenues and expenses are recognized, is not dependent on when cash is received or paid, but rather is dependent on concepts such as earnings, realization or realizability (for revenues) and the using up of resources (for expenses).

While teaching these two accrual accounting principles, I will also introduce the concept of "deferrals" and "accruals" which result when the timing of resource in and outflows (particularly cash resources) do not match the timing of revenue recognition and expense recognition.

To Complete This Module

To complete this module, you will need to study all of the content pages and successfully complete the related topic and module quizzes. To successfully complete quizzes you need to achieve a score of at least 4 out of 5 for topical quizzes and achieve a score of at least 8 out of 10 for the module quiz. You may take and re-take quizzes as many times as necessary to master the material and get your passing score.

To track which content pages you have viewed and which quizzes you have successfully completed, click the "Modules" link on the course menu on the left.  A green check mark will appear to the left of each “Study” page that you have viewed and by each “Quiz” that you have successfully completed in the module. 

I anticipate that this module will take about 2 hours to complete.