lecture 1 - accruals concept Flashcards
1
Q
what is the accruals concept
A
incomes and expenses are recognised (recorded) as soon as they occur not neccesarily when cash or it’s equivalent is recieved or paid
2
Q
as long as you make sale during a period what should happen
A
it should be recorded regardless of when I recieve the cash
3
Q
revenue and expenses are recorded regardless
A
if they’ve been paid/received yet
4
Q
if an income statement ends on 31/12/23 what do your ecord
A
all incomes and expenses incurred or accrued during that 12 month period regardless of whether cash receipts settled or not
5
Q
what is the profit/ loss
A
total income for the period - total expenses incurred for the period
6
Q
income > expenses =
A
profit
7
Q
expenses > income
A
loss
8
Q
A
