Change of Accounting Basis

Question 1

Change of Accounting Basis

The Default Method for Calculating Profits is:

Answer 1

The Cash Basis.

For Sole Traders and Partnerships

Question 2

Change of Accounting Basis

What Election is Available for Changing Accounting Basis.

Answer 2

To Calculate Profits on an Accruals Basis.

In Accordance to GAAP.

Question 3

Change of Accounting Basis

An Adjustment is Required to Ensure:

Answer 3

• All Income is Taxed Once;
• All Expenses are Relieved Once.