Expense recognition method

CFA Level I
#1

Do we

  1. recognize expenses in the period that it consumes the associated economic benefits.

or by the matching principle when we make the sales of products, those expenses associated with them are recognized… ???

or both??

#2

Suppose that you’re a manufacturer, and you process raw materials into some sort of finished product. You consume the associated economic benefit when you sell the product, not when you manufacture it, so you recognize the expense in the same period as the sale, which is what the matching principle says.

#3

Thanks S2000, I sent you a message, I dont know if you could please help me with my other questions… specially the one with the FCFF treatments with IFRS