Accrual accounting is an accounting system in which ________.
A)measurement of income is NOT based on cash receipts and cash disbursements
B)measurement of income is based on cash receipts and cash disbursements
C)all businesses prepare reports required by the FASB
D)there are no timing differences

Question

Quizplus · Accepted Answer

Accrual accounting records revenue and expenses when they are earned or incurred, regardless of the timing of cash receipts and disbursements. This means that there may be timing differences between when revenue and expenses are recorded and when cash is actually received or paid out.

Accrual Accounting Is an Accounting System in Which ________