At year-end, companies that utilize accrual-based accounting systems complete the measurement process throughMultiple choice question.recording of adjusting entriesconversion to cash-basisthe preparation of an unadjusted trial balanceposting of non-cash transactions occurring during the year

Under accrual-basis accountingSelect answer from the options belownet income is calculated by matching cash outflows against cash inflows.cash must be received before revenue is recognized.events that change a company's financial statements are recognized in the period they occur rather than in the period in which cash is paid or received.the ledger accounts must be adjusted to reflect a cash basis of accounting before financial statements are prepared under generally accepted accounting principles.

Preparing a detailed schedule of accounts receivable balances that are more than 120 days past due for only those customers who regularly purchase the company’s products. The purpose of the analysis is to identify potential changes to the credit terms offered to regular customers (e.g., payment due dates, interest on overdue balances). multiple choice 5Financial accounting IncorrectManagerial accounting

The special feature of accrual basis of accounting is *a. recording expenses only when cash is paidb. recording revenues only when cash is receivedc. recording adjustments only if it has a favorable effect on the company’s incomed. recording revenues and expenses when they are earned and incurred regardless of when cash is received or paid.

Accrual basis accounting:Multiple ChoiceIncreases the comparability of financial statements from period to period.Is flawed because it gives complete information about cash flows.Recognizes revenues when received in cash.Recognizes expenses when paid in cash.Eliminates the need for adjusting entries at the end of each period.

The accounting period assumption means that:Group of answer choicesthe cash approach is always used to measure profits.the activities of the owner are assumed to be separate from those of the business.the accrual approach is always used to measure profits.for reporting purposes the economic life of an entity is divided into arbitrary time periods.