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    Financial Accounting - Accounting Period Concept- yasmeen a.reda

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    yasmeen.a.reda2001
    The document discusses the accounting period concept, comparing cash basis and accrual basis accounting. It highlights that cash basis recognizes revenue and expenses when cash is received or paid, while accrual basis recognizes them when earned or incurred. The document also mentions the adjusting process that exists only under accrual accounting, addressing time differences in reporting revenue and expenses.

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    Financial Accounting - Accounting Period Concept- yasmeen a.reda

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    yasmeen.a.reda2001
    0 views2 pages
    The document discusses the accounting period concept, comparing cash basis and accrual basis accounting. It highlights that cash basis recognizes revenue and expenses when cash is received or paid, while accrual basis recognizes them when earned or incurred. The document also mentions the adjusting process that exists only under accrual accounting, addressing time differences in reporting revenue and expenses.

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    Accounting period concept notes

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    The document discusses the accounting period concept, comparing cash basis and accrual basis accounting. It highlights that cash basis recognizes revenue and expenses when cash is received or paid, while accrual basis recognizes them when earned or incurred. The document also mentions the adjusting process that exists only under accrual accounting, addressing time differences in reporting revenue and expenses.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    0 views2 pages

    Financial Accounting - Accounting Period Concept- yasmeen a.reda

    Uploaded by

    yasmeen.a.reda2001
    The document discusses the accounting period concept, comparing cash basis and accrual basis accounting. It highlights that cash basis recognizes revenue and expenses when cash is received or paid, while accrual basis recognizes them when earned or incurred. The document also mentions the adjusting process that exists only under accrual accounting, addressing time differences in reporting revenue and expenses.

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    © All Rights Reserved
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    Accounting period concept

    cash basis of accrual basis of


    accountin
    9 &* Cash is
    equivalent to expenses
    *

    *
    Cash is not
    equivalent to
    Most businesses use it
    expenses
    3 accountin
    9

    I
    -
    based on 2
    concepts -

    reports revenue when


    cash received
    is revenue
    recognition matching
    concept concept
    reports expense when
    I

    cash is paid reports revenue when it is revenue & related


    expenses are
    earned (if] ...

    recorded in the same period


    services are provided

    sold
    goods are

    *
    Adjusting process
    exists
    only under basis of accounting
    Time difference in
    reporting revenue vs .
    cash
    receipts &
    expenses vs . Cash
    payment
    Accured revenue ~ X
    Revenue # Cash
    Unearned &
    revenue X receipts
    Accured expensesa - ~ X

    Expense = Cash payment


    Prepaid expenses O - X ~

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