Which of the following statements concerning accrual-basis accounting is incorrect?
A) Accrual-basis accounting follows the revenue recognition principle.
B) Accrual-basis accounting is the method required by generally accepted accounting principles.
C) Accrual-basis accounting recognizes expenses when they are paid.
D) Accrual-basis accounting follows the matching principle.

Question

Quizplus · Accepted Answer

Accrual-basis accounting recognizes revenue when it is earned and expenses when they are incurred, regardless of when payment is made. It does not recognize expenses only when they are paid.

Which of the Following Statements Concerning Accrual-Basis Accounting Is Incorrect