In the 14th century, plague ravaged Europe and Asia and was called the Black Death. Plague does not respond to penicillin, but other antibiotics are effective. Sanitary measures against fleas and rodents, quarantine and extreme caution in handling infectious materials help to suppress epidemics.
1. Expense recognition. Expenses are decreases in assets (e.g., rent expenses) or increases in liabilities (e.g., accrued utility expenses) that result from operating activities undertaken to generate revenue. Expenses are recognized in accordance with the matching principle. This principle mandates that the expense or cost of doing business is recorded in the same period as the revenue that has been generated as the result of incurring that expense or cost.
Capitalizing Expenses. When you capitalize an expense and then amortize the costs, you spread the cost over an extended period of time. Suppose you decide to amortize a $60,000 expense over a five-year period.You would record $60,000 to an asset account and offset it with a $60,000 credit to notes payable or cash.All of these are balance sheet accounts, so you have not yet affected your income statement.apitalizing Expenses. When you capitalize an expense and then amortize the costs, you spread the cost over an extended period of time. Suppose you decide to amortize a $60,000 expense over a five-year period.