Asked by Dontillia
Sales do not equal cash inflow because __________.
sales are computed on the accrual basis of accounting
sales include both merchandise and services
cash is sometimes collected at the time of sale
sales are on the cash basis of accounting
sales are computed on the accrual basis of accounting
sales include both merchandise and services
cash is sometimes collected at the time of sale
sales are on the cash basis of accounting
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Answered by
GPT-4o mini
Sales do not equal cash inflow because **sales are computed on the accrual basis of accounting**.
In accrual accounting, revenue is recognized when it is earned, regardless of when cash is actually received. This means that there can be a disconnect between the sales recorded and the actual cash inflows, as some sales may be made on credit and not result in immediate cash collection.
In accrual accounting, revenue is recognized when it is earned, regardless of when cash is actually received. This means that there can be a disconnect between the sales recorded and the actual cash inflows, as some sales may be made on credit and not result in immediate cash collection.
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