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Accrual-basis accounting involves recording revenues when earned and recording expenses with their related revenues. True or False?

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Question added by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town
Date Posted: 2014/04/12
Divyesh Patel
by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town

Answer is TRUE.

Accrual basis accounting—uses the adjusting process to recognize revenue when earned and to match expenses with revenues. This means the economic effects of revenues and expenses are recorded when earned or incurred, not when cash is received or paid.

santhosh simon
by santhosh simon , Senior Accountant , engineering

accural expenses is the fixed cost which remain constant recurring irrespective of revenu accrual

Maria Theresa Gumangan
by Maria Theresa Gumangan , Accounts And Admin Officer , Tecumex Middle East FZCO

False. Accrual-basis of accounting means recognizing / recording of revenues when earned and expenses when incurred. Hence it include specific expenses not directly related to a particular revenue earned during the period.  This is needed as it shows faithful representation of the effects of transactions and also to adhering to compliance required presenting F/S

Khalid Noor
by Khalid Noor , Accounting Manager , FedEx

Wrong, expenses when incurred without having any related revenue.

Mohammad Sultan Mahmud
by Mohammad Sultan Mahmud , Accounts Manager , Abrar Plastic Industries Ltd

Accrued basis revenue and expenses non cash related revenue and expenses whose are earned and incurred

Muhammed Nisar
by Muhammed Nisar , Assistant Manager - Finance and Accounts , YouGotaGift

False.Accrual means recognition of revenue and cost as they are earned or incurred and not as money received or paid.

Deleted user
by Deleted user

True...this is just recording of transaction of income and expenditure..

Moses Ajayi Murorun
by Moses Ajayi Murorun , Production Executives , Various Organizations

False

Juanito Jr De Guzman
by Juanito Jr De Guzman , Chief Accountant , Zen FZE

Recording revenues when earned - "True"

Recording expense with their related revenue- " True"

(i.e. Selling of FINISHED GOODS, upon delivery we recognized Revenue accordingly we record expense as Cost of Sales.)

Umer Aziz
by Umer Aziz , Senior Accountant , TERNA Bahrain Holding - GEK Group (www.terna.gr)

It is Trure

Asad zaman
by Asad zaman , Audit/Finance , Rafaqat Baber and co

As far as Revenue  is concern you are right.but expense is recognized when incurred irrepective of revenue earned....

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