Accrual Accounting Is an Accounting System in Which ________

question 92

Multiple Choice

Accrual accounting is an accounting system in which ________.

• A)measurement of income is NOT based on cash receipts and cash disbursements
• B)measurement of income is based on cash receipts and cash disbursements
• C)all businesses prepare reports required by the FASB
• D)there are no timing differences

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Definitions:

Market Price

The price at which an asset or service is currently being traded in the marketplace.

Acquisition

The method of gaining control over another corporation by buying its shares or assets.

Incremental Value

The added value or additional benefits generated from a decision, investment, or action compared to its absence.

All-Stock Deal

A type of business acquisition or merger where payment to the selling party is made entirely with the stocks of the buying company.