Accrual vs Cash Basis Accounting

Accrual vs Cash Basis Accounting
Accrual vs Cash Basis Accounting
Submit written responses to these questions.
Explain the difference between the accrual basis of accounting and the cash basis of accounting. What are the major reasons for using accrual accounting?
What are the purpose of a journal and a ledger?
Give an example of a contra-asset, and explain how it is recorded on the ledger as a transaction.
Explain what a “prepaid expense” is and how it is recorded on the ledger as a transaction.
What are the major differences in recording transactions for a for-profit organization versus a not-for-profit, or are there any?
List and record each transaction for S. Zee Outpatient Clinic under the accrual basis of accounting at December 31, 20X1. then develop a balance sheet as of December 31, 20X1, and a statement of operations for the year ended December 31, 20X1.
The clinic received a $3,000,000 of unrestricted cash contribution from the community. (Hint: this transaction increases the unrestricted net assets account.)
The clinic purchased $2,000,000 of equipment. The clinic paid cash for the equipment.
The clinic borrowed $1,000,000 from the bank a long-term basis,
The clinic purchased $1,500,000 of supplies on credit.
The clinic provided $5,500,000 services on credit.
In the provision of these services, the clinic used $1,000,000 of supplies.
The clinic received $500,000 in advance to care for capacitated patients.
The clinic incurred $2,000,000 in labor expenses and paid cash for them.
The clinic incurred $1,500,000 in general expenses and paid cash for them.
The clinic received $4,500,000 form patients and their third parties in payment of outstanding accounts.
The clinic met $300,000 of its obligation to capacitated patients in Transaction g.
The clinic made a $100,000 cash payment on the long-term loan.
The clinic also made a cash interest payment of $50,000.
A donor made a temporarily restricted donation of $100,000 to be used for operations.
The clinic recognized $200,000 in depreciation for the year.
The clinic recognized $500,000 of patient accounts would not be received.
How do capital structure rations and liquidity rations differ in providing insight into an organization’s ability to pay debt obligations?
Identify and explain two situations where an organization might have increasing activity rations but declining profitability.
Accounting on a cash basis
Revenues are recognized when cash is received, and expenses are recognized when cash is paid, according to the cash basis of accounting.
Accounts receivable and payable are not recognized under this technique.
Because it is simple to maintain, many small businesses choose to adopt the cash basis of accounting.
There is no need to manage receivables or payables, and it is simple to tell when a transaction has occurred (the money is in the bank or out of the bank).
The cash technique is also useful for tracking how much cash the firm has on hand at any particular time; you may check your bank balance to see how much cash you have on hand.
Furthermore, because transactions aren’t documented until cash is received or paid, the income of the business isn’t taxed until it reaches the bank.
Accounting on an accrual basis
Revenues and expenses are recorded when they are earned, regardless of when the money is actually collected or paid, according to accrual accounting.
For example, rather than recording income when you are paid, you would record revenue when a project is completed.
This is a more popular method than the cash method.
The accrual basis has the advantage of providing a more realistic image of income and expenses over time, as opposed to cash accounting, which cannot provide a long-term view of the business.
The disadvantage is that accrual accounting does not provide visibility into cash flow; a company can look to be profitable while actually having empty bank accounts.
Without proper cash flow monitoring, accrual basis accounting can have disastrous implications.
It’s worth noting that many companies keep their books on a cash basis yet file their taxes on an accrual basis.
When it comes to tax preparation, they take the necessary measures to convert cash basis accounting to accrual accounting.

So much stress and so little time? Take care of yourself: let us help you with your task on
Accrual vs Cash Basis Accounting
Get a 20% Discount on this Paper
Get Help Now
Calculate the price
Make an order in advance and get the best price
Pages (550 words)
$0.00
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
Sign up, place your order, and leave the rest to our professional paper writers in less than 2 minutes.
step 1
Upload assignment instructions
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
s
Get personalized services with Do My Homeworkk
One writer for all your papers
You can select one writer for all your papers. This option enhances the consistency in the quality of your assignments. Select your preferred writer from the list of writers who have handledf your previous assignments
Same paper from different writers
Are you ordering the same assignment for a friend? You can get the same paper from different writers. The goal is to produce 100% unique and original papers
Copy of sources used
Our homework writers will provide you with copies of sources used on your request. Just add the option when plaing your order
What our partners say about us
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
Classic English Literature
THANK YOU SO MUCH!!!! :)
Customer 452493, April 19th, 2022
Nursing
Good work, professional and beat the deadline. Thank you so very much
Customer 452445, August 24th, 2021
Finance
Wow! I should never have doubted you guys. Thank you for the excellent grade
Customer 452443, August 27th, 2021
Nursing
Excellent! Followed directions and completed a great paper
Customer 452445, August 22nd, 2021
Management
Job done to satisfaction. Thank you!
Customer 452443, October 31st, 2021
National Security Intelligence and Security Analysis
Timeliness
Customer 452457, November 3rd, 2021
Business and administrative studies
Thank you so much for your help!!!!!
Customer 452519, November 9th, 2022
Chemical Engineering
Amazing. The writer delivered the draft earlier than expected, lol. I am pleased with the work; I hope my supervisor will like it too.
Customer 452443, September 1st, 2021
Finance
Thank you
Customer 452445, September 8th, 2021
English 101
Great work!
Customer 452443, December 2nd, 2021
Leadership Studies
This is great! Thanks a bunch
Customer 452485, March 1st, 2022
Other
THANK YOU SO MUCH!
Customer 452493, May 16th, 2022
OUR GIFT TO YOU
15% OFF your first order
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat

Order your essay today and save 15% with the discount code ESSAYHELP