The ____________________ Basis of Accounting Requires That Revenues Be Recorded

question 142

Short Answer

The ____________________ basis of accounting requires that revenues be recorded in the period they are earned rather than in the period they are received.

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Definitions:

Chart of Accounts

A structured list of all the financial and nominal accounts in a company, detailing every type of transaction a business might conduct.

Accounting System

A structured process of collecting, recording, summarizing, and interpreting financial information of a business.

Adjusting Entries

At the close of a financial period, journal entries are created to distribute earnings and costs to the period in which they genuinely took place.

Adjusted Trial Balance

is a listing of all company accounts that will appear on the financial statements after making end-of-period adjustments.