Which of the Following Statements Is True About the Cash

Multiple Choice

Which of the following statements is true about the cash basis of accounting?

A) It can distort reported profits.
B) It is the only acceptable method for external reporting.
C) It reports revenues when earned and expenses when incurred.
D) It is used when cash is paid at the same time as the cost is incurred,but is not used when cash is paid before the expense is incurred.