Question

4 marks explaination about accrual concept... Plz make it simple to learn

Answer 1

Answer:

Financial statements are prepared under the Accruals Concept of accounting which requires that income and expense must be recognized in the accounting periods to which they relate rather than on cash basis. An exception to this general rule is the cash flow statement whose main purpose is to present the cash flow effects of transaction during an accounting period.

Answer 2

Answer:

accrual concept is that in which transaction of cash paid or cash not paid and income received and not received is recorded. business accounts is prepared on accrual basis not on cash basis