Which of the Following Statements Does Not Properly Describe the Accrual

question 5

Multiple Choice

Which of the following statements does not properly describe the accrual basis of accounting?

• A) Expenses are recognized when incurred regardless of the timing of cash flows.
• B) Revenues are recognized when earned regardless of the timing of cash flows.
• C)Generally accepted accounting principles require use of the accrual basis.
• D)It should not be used when providing financial statements to external decision makers.

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Definitions:

M

Often used as an abbreviation for "meter" in metric measurements or as a designation for thousands in units of measure.

Internal Threads

The threads located within a hole or bore, allowing for the screwing in of a mating part with external threads.

Tap

A tool used to cut internal threads into a hole, creating a surface that can accommodate a screw or bolt.

American Society of Mechanical Engineers

A professional association that sets engineering standards, focusing on mechanical engineering.