The Accrual Basis of Accounting

Multiple Choice

The accrual basis of accounting:

A) Recognizes expenses when paid in cash.
B) Is generally accepted for external reporting because it is more useful than cash basis for most business decisions.
C) Recognizes revenues when received in cash.
D) Is flawed because it gives complete information about cash flows.
E) Eliminates the need for adjusting entries at the end of each period.