The Major Difference Between Cash-Basis Accounting and Accrual-Basis Accounting Lies

question 70

True/False

The major difference between cash-basis accounting and accrual-basis accounting lies in when the firm recognizes revenue and profits.

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Definitions:

Calculate

To determine mathematically the amount or number of something, often involving the use of specific formulas or models.

Period

In accounting, a period is a length of time during which financial activities are recorded and reported, such as a month, quarter, or year.

Calculate

To ascertain or compute a figure or amount through mathematical processes.

Period

A specific span of time during which certain financial activities or measurements are recorded and assessed.