August 1, 2013
Question:
Answer:
In accrual accounting, current liabilities are defined as due within five years, whereas in modified cash accounting current liabilities are defined as due within one year
Correct Answer?
Explanation:
In modified cash accounting, revenue is recorded when the service is performed and in accrual accounting, revenue is recorded when the payment is received
In accrual accounting, revenue is recorded when the service is performed and in modified cash accounting, revenue is recorded when the payment is received
In modified cash accounting, income is equal to revenue minus expenses, whereas in accrual accounting expenses are not recorded
Format:
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