Briefly explain two accounting concepts that govern when revenue and expenses are recognised in a firms...

Question

...accounts

Answer 1

The matching principle:

"The concept that revenue and the costs incurred in earning the revenue should be matched in the appropriate accounting periods."

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The accrual basis of accounting:

"A system of accounting by which all revenues and expenses are matched and reported on financial statements for the applicable period, regardless of when the cash related to the transaction is received or paid."

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Edit: I suppose that the real two concepts the question is asking for are 'cash basis of accounting' (you can look that up in your text or do a quick online search for it) and 'accrual basis of accounting' described above. I put in the matching principle since it is part of the accrual basis...