Should a small business use a cash or accrual accounting method? A CPA answers with examples. If you are an entrepreneur or small business owner, it is a good idea to familiarize yourself with both ...

Expenses are an unavoidable cost of doing -- and staying in -- business. When a business incurs an expense, there are two accounting methods it may use to record the expense to its books -- the cash ...

Many businesses prefer the simplicity of using cash basis accounting. An expense is recorded when cash is paid and income is recorded when cash is received. However, Generally Accepted Accounting ...

While every public company uses accrual basis accounting in its financial reporting, it’s not the only bookkeeping standard out there. Cash basis accounting also has practical applications in business ...

Accrual accounting is one of the primary accounting methods and is based on the matching principle, which dictates that revenues and their associated expenses be recorded in the same accounting period ...

Cash basis accounting records when cash actually changes hands in a transaction, providing a real-time view of your financial position that reflects the actual cash flow of a business or individual.

James Chen, CMT is an expert trader, investment adviser, and global market strategist. David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of financial accounting, ...

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. Lea Uradu, J.D., is a Maryland state registered tax preparer, state-certified notary public, ...