Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 17 - No. 34)
Which of the following statements is true regarding the accrual accounting method?
Revenues and expenses are recorded when cash changes hands.
Revenues are recorded when earned, and expenses are recorded when incurred.
Only cash transactions are recorded.
Depreciation is ignored
Explanation
Accrual accounting records revenues when earned and expenses when incurred, regardless of cash flow.
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