Which of the Following Is TRUE

question 97

Multiple Choice

Which of the following is TRUE?

• A) Accrual accounting is required by generally accepted accounting principles.
• B) Accrual accounting records expenses when incurred. Cash-basis accounting records expenses when cash is paid.
• C) Accrual accounting records revenue when services are rendered. Cash-basis accounting records revenue when cash is received.
• D) All of the above are true.

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Definitions:

Benefit Period

The duration during which benefits, such as those from an insurance policy or investment, are paid out.

Depreciation Expense

The distribution of a physical asset's expense over its lifespan, mirroring its decrease in worth as time progresses.

Estimated Depreciation

A projected amount of depreciation expense for an asset, reflecting its anticipated decline in value over a specified period due to wear and tear or obsolescence.

Accumulated Depreciation

The cumulative depreciation of an asset up to a single point in its life, reflecting the amount of value it has lost over time.