Which of the Following Statements Does Not Properly Describe the Accrual

question 98

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 incurred 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.

---

Definitions:

Anticipated Need

Expectation of a requirement or demand in the future, often based on current trends or forecasts.

New Product Line

A group of related products that are offered by a company to address customer needs in a particular market segment, often involving the introduction of innovations or expanding the brand's reach.

Innate Fears

Fears that are instinctively present from birth, not requiring personal experiences to be triggered.

Adaptive Advantage

A genetic trait that improves the survival or reproductive success of an organism in its environment.