Which of the following is correct regarding accrual accounting?
A)Adjusting the accounts is a technique used to accomplish accural accounting.
B)Revenues are recorded when received.
C)Expenses are recorded when earned.
D)Net income is the difference between cash receipts from customers and cash payments for expenses.

Question

Quizplus · Accepted Answer

Accrual accounting requires recognizing revenues and expenses when they are earned or incurred, regardless of when cash is received or paid. Adjusting entries are made at the end of each accounting period to ensure that all revenues and expenses are properly recognized in that period.

Which of the Following Is Correct Regarding Accrual Accounting