A Small Company May Be Able to Justify Using a Cash

question 201

Multiple Choice

A small company may be able to justify using a cash basis of accounting if they have

• A) sales under $1000000.
• B) no accountants on staff.
• C) few receivables and payables.
• D) all sales and purchases on account.

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Definitions:

State Legislature

is the legislative body within a state that has the authority to make, amend, and repeal laws within that state.

Common Law

A legal system based on judicial decisions and precedents rather than statutory laws, primarily used in the UK and countries that were former colonies.

Judge-Made Law

Laws that have evolved from judicial decisions or case law, rather than from statutes or constitutions, thereby reflecting the judiciary's role in interpreting and applying legal principles to specific cases.

Legal Positivists

A school of thought in jurisprudence that holds the belief that the validity of a law is not related to its morality but is contingent upon its sources and recognition by the state.