Under the accrual basis of accounting: a. cash must be received before revenue i
ID: 579345 • Letter: U
Question
Under the accrual basis of accounting:a. cash must be received before revenue is recognized.
b. net income is calculated by matching cash outflows against cash inflows.
c. events that change a company's financial statements are recognized in the period they occur rather than in the period in which cash is paid or received.
d. the ledger accounts must be adjusted to reflect a cash basis of accounting before financial statements are prepared under generally accepted accounting principles. Question 7 (1 point) 1) cash must be received before revenue is recognized. 2) net income is calculated by matching cash outflows against cash inflows. ·3) events that change a company's financial statements are recognized in the period they Under the accrual basis of accounting: occur rather than in the period in which cash is paid or received. 4 the ledger accounts must be adjusted to reflect a cash basis of accounting before financial statements are prepared under generally accepted accounting principles. Save Question 8(1 point) Adjusting entries can be classified as: 1) postponements and advances. accruals and deferrals. deferrals and postponements. accruals and advances. Question 9 (1 point) An adjusting entry can include a 11 debit to an asset and a credit to a liability 2) debit to a revenue and a credit to an asset. debit to a liability and a credit to a revenue. an expense and a credit to a revenue.
Explanation / Answer
Ans 7 : c) Events that change a company's financial statements are recognised in the period they occur rather than in the period in which the cash is paid or received.
So in such an accounting (accrual) the revenues are matched at the time of expenses , and not when the actual transaction of money has taken place.
It refers to the individual entry recording expense or revenue.
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