Question

differentiate between cash basis and accrual basis of accounting

Answer 1

The cash basis and accrual basis of accounting are two different methods used to record accountingtransactions. The core underlyingdifference between the two methods is in the timing of transaction recordation. ... Accrual basis. Revenue is recorded when earned and expenses are recorded when consumed.

Answer 2

Cash Basis

Here, the transactions are recorded only when cash is received or paid.

Accrual Basis

Here , the transactions are recorded as when the transaction takes irrespective of the fact, whether cash is received/paid.