The Differences Between Accrual & Cash-Basis Accounting

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

The method of accounting that recognizes revenue when money is received and expenses when bills are paid is called:

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1. The method of accounting that recognizes revenue when it is earned and expenses when they are incurred is called:

2. Which accounting method is best for keeping track of cash inflows and cash outflows?

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About This Quiz & Worksheet

These assessments were created to help you measure how well you know the differences between accrual and cash- basis accounting. Critical quiz topics include cash basis and accounting methods.

Quiz & Worksheet Goals

After taking the quiz, you will be able to:

  • Identify cash basis accounting
  • Identify accrual basis accounting
  • Characteristics of accrual basis accounting
  • Contrast and compare cash basis and accrual basis accounting

Skills practiced

Here are some skills which these tools test:

  • Distinguishing Differences- compare and contrast topics from the lesson, such as accrual and cash-basis accounting
  • Interpreting information - verify that you can read information regarding accrual versus cash-basis accounting and interpret it correctly
  • Knowledge application - use your knowledge to answer questions about accrual versus cash-basis accounting

Additional Learning

For more information, please review the lesson entitled The Differences Between Accrual & Cash-Basis Spending. Here are some topics covered by this lesson:

  • Understanding accrual and cash-basis approaches to accounting
  • Examples of cash-basis and accrual accounting
  • Know the fundamental differences between the two accounting methods
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