Which of the Following Is Not a Potential Benefit of Accrual

question 79

Multiple Choice

Which of the following is not a potential benefit of accrual accounting, compared to cash-basis accounting?

• A) Timeliness.
• B) Better reflecting economic activity.
• C) Periodicity.
• D) Better matching of revenues and expenses.

---

Definitions:

Construction In Progress

This refers to the balance sheet classification of the cost of construction projects that are not yet complete.

Liability

A financial obligation or debt owed by a business to another entity, which requires settlement through the transfer of assets or services.

Revenue Recognition

The process by which companies document and account for their income, specifically defining when and under what circumstances revenue is considered earned.

Manage Earnings

This involves legal and possibly unethical financial reporting strategies to make a company's financial condition appear more favorable than it actually is.