Question

If you want to recognize revenue during the period in which the related sales activity occurred, which accounting method would you use?a. Accrual accounting b. Cash-basis accounting

Answer 1

Answer:

a. Accrual accounting

Explanation:

Accounting method in which the revenue and expenses are recorded in the month in which its activities occurred regardless of cash is received or paid. Cash-basis accounting is referred to the recognition of revenue and expenses when the cash relating to the activities received or paid. So If we want to recognize revenue during the period in which the related sales activity occurred, we will use accrual accounting method.