In which of the following ways is an income and expense statement and a cash budget alike?
A) They are prepared on a cash basis.
B) They compare projected income to projected expenses.
C) They show an individual's net worth.
D) They describe an individual's financial position at a given point in time.
E) They are used as the basis for computing solvency and liquidity ratios.

Question

Quizplus · Accepted Answer

Both an income and expense statement and a cash budget are prepared on a cash basis, meaning they record transactions when cash is actually received or paid.

In Which of the Following Ways Is an Income and Expense