Chapter 3

Chapter 3 - machinery, trucks, building and land. What is...

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Chapter 3: Why is the accrual basis of accounting generally preferred over cash basis? Accrual basis of accounting in generally preferred over cash basis, because it uses the adjusting process  to recognized revenues when earned and expenses when incurred. Cash basis not consistent with  generally accepted accounting principles (GAAP).  What type of asset(s) requires adjusting entries to record depreciation? Assets that required adjustment entries to record depreciation are plant assets such as, furniture, 
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Unformatted text preview: machinery, trucks, building and land. What is accrued revenue? give an example. Accrued revenues are revenues earned in a period that are both unrecorded and not yet received in cash. An example is I’m a contractor and currently I started a project for a general contracting company. The total fee for the project is $10,000 but I wont get the pay until the project is complete (10,000 is my accrued revenue). Please review and post your comments...
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This note was uploaded on 11/15/2010 for the course AC 201 taught by Professor Leland during the Fall '10 term at Park.

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