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amann
Jun 23, 2011, 01:21 PM
Why do you suppose financial statements are constructed on an accrual basis rather than a cash basis when cash accounting is so much easier to understand?

joypulv
Jun 23, 2011, 03:07 PM
Countless small businesses DO run just fine on a cash basis, but large companies need to know what expenses and income are not paid/received yet. Accrual gives a more accurate picture.