QUESTION
Acme Industries purchases new Machinery, that manufactures a product, and pays a total of $500,000 including all reasonable and necessary costs associated with purchasing the machinery.
Assuming that Acme made a rational economic decision in purchasing this machinery, answer the following
i) In what way should this Machinery's purchase, and use over time, conform with the Accrual Concept in accounting and the Matching Principle ?
ii) Acme also employs 5 people and pays them total wages of $250,000 each year.
In what way should the wages conform with both the Accrual Concept and the Matching Principle ?
NOTE Do NOT simply give definitions as this is NOT what the questions are asking
The answers MUST be in your own words, not from a textbook or any other source.