Which of the following defines cash-based accounting system?
A) Measures the cost of replacing an employee.
B) Provides the appropriate information to the external community.
C) Records transactions when money is either received or spent.
D) Provides information to the management of a business and aids in internal controls.
E) Records transactions when they occur.

Question

Quizplus · Accepted Answer

A cash-based accounting system records transactions when money is either received or spent, rather than when they occur. This system is based on actual cash flows and is simpler to implement and maintain, but may not provide a complete picture of a business's financial situation.

Which of the Following Defines Cash-Based Accounting System