accounting statement

Accounting
Tutor: None Selected Time limit: 1 Day

I am having trouble comparing cash and accrual basis accounting and applying the revenue recognition principle and the matching principle.  How will I show whether each transaction would be handled as a revenue or and expense using both the cash basis and accrual basis accounting systems. 

Sep 7th, 2015

Thank you for the opportunity to help you with your question!

 Its important to realize the difference between thew two systems , its the timing of recognizing expenses and revenues.

Cash Basis

It treats  for  in the income statement f when the money is  received  and accounts for expenses when paid only.

 Expenses are reported on the income statement when the cash is paid out. ses when paid

Accrual Basis

Accrual basis reports all of the revenues actually earned during the period and all of the expenses incurred in order to earn the revenues and  expenses reported on the income statement in the period when they are incurred, meaning the revenues are recorded even if cash has not been received.

Thank you. Ask any question

Please let me know if you need any clarification. I'm always happy to answer your questions.
Sep 7th, 2015

Studypool's Notebank makes it easy to buy and sell old notes, study guides, reviews, etc.
Click to visit
The Notebank
...
Sep 7th, 2015
...
Sep 7th, 2015
Feb 27th, 2017
check_circle
Mark as Final Answer
check_circle
Unmark as Final Answer
check_circle
Final Answer

Secure Information

Content will be erased after question is completed.

check_circle
Final Answer