Asked by
Kylee DePew
on Nov 14, 2024Verified
A small company may be able to justify using a cash basis of accounting if they have
A) sales under $1000000.
B) no accountants on staff.
C) few receivables and payables.
D) all sales and purchases on account.
Cash Basis
An accounting method where revenue and expenses are recognized only when cash is received or paid out, respectively.
Receivables
Money owed to a company by its customers or clients for goods or services provided that have not yet been paid for.
Payables
Payables, also known as Accounts Payable, are liabilities of a company that represent money owed to creditors for goods and services received but not yet paid for.
- Gain insight into the elementary ideas underpinning accrual and cash basis accounting.
Verified Answer
VP
Learning Objectives
- Gain insight into the elementary ideas underpinning accrual and cash basis accounting.