Which of the following relates to cash basis of accounting?

Assessment: WAEC SSCE - Financial Accounting - 2015 (Objective) Subject: Financial Accounting

Question 1 Report

Which of the following relates to cash basis of accounting?

Answer Details
The cash basis of accounting is a method of recording transactions in which revenue and expenses are only recognized when cash is received or paid out, respectively. Therefore, only cash transactions are recorded, and other items such as accruals, prepayments, debtors, creditors, and fixed assets are not considered. This means that the answer to the question is: - Accruals and prepayments are not considered
Read lesson note on Cashbook (JAMB)
Read lesson note on Principles Of Double Entry (JAMB)
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