“It’s Accrual World” Accrual basis accounting is based on the “Matching Principal” which means the goal is to match revenues and expenses in the same period. In short, this means
Depreciation Expense When you purchase something “major” like a piece of machinery or equipment you do so because of the long term benefit you will derive from that “Fixed Asset.”
Cash Basis AccountingCash Basis Accounting means income and expenses are only recorded when paid.In the strictest sense, this means no accounts receivableComing Soon to a Browser Near You! and no accounts payableComing Soon to a Browser Near You exist.In theory, this means
There are 5 major account types in a company’s Chart of Accounts: Assets LiabilitiesComing Soon to a Browser Near You! Equity Revenue Expenses The first 3 make up the
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