Cash-Basis Accounting Is Allowed Under

question 161

Multiple Choice

Cash-basis accounting is allowed under

• A)GAAP but not IFRS.
• B)IFRS but not GAAP.
• C)both IFRS and GAAP.
• D)neither IFRS nor GAAP.

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Definitions:

Initial Cost

The total expense incurred to acquire an asset or start a project, including all relevant expenses.

Cash Inflows

Cash inflows represent the money received by a business from its operational, financial, and investment activities, contributing to its total cash pool.

Rate of Interest

The percent of principal charged by the lender for the use of its money or the rate earned on invested capital.

Initial Investment

The upfront cash outlay required to start a project or investment.