Which of the Following Statements About Cash Basis Accounting and Accrual

Multiple Choice

Which of the following statements about cash basis accounting and accrual basis accounting is correct?

A) Net income is always larger under accrual basis accounting than cash basis accounting.
B) GAAP does not require the use of accrual basis accounting for external reporting.
C) Accrual basis accounting and cash basis accounting will always produce the same amount of net income.
D) Accrual basis accounting provides a better measure of operating performance than cash basis accounting.