Discover when businesses must use accrual accounting and how it differs from cash accounting. Learn why it's essential for ...

Accrual accounting example If a fictional company called Acme Adhesives sent an invoice to a client for $4,000 on June 30th, and the client remitted payment nine days later on July 9th, that $4,000 of ...

A prepaid asset is an expenditure of money in advance of when the money is due. For example, you might pay up front for a year's rent or insurance, even though the payments are due monthly. Under ...

There are two main types of business accounting methods: cash and accrual. In general, small-business owners have the option to choose which one to use. Both methods function to keep track of income ...

Take an in-depth look at the treatment of revenues and expenses within the accrual method of accounting and learn why many ...

Accrual accounting allows a business to record revenue before cash is collected. Investigate changes in accounts receivable on the cash flow statement to evaluate real cash status. Monitor allowance ...

Should small businesses use cash or accrual accounting? This question gets asked almost as much as “paper or plastic?” and “debit or credit?” While the IRS requires some companies to use accrual ...

Learn what every business owner needs to know about financial accounting, accounting software and financial statements.

Opinions expressed by Entrepreneur contributors are their own. Should small businesses use cash or accrual accounting? This question gets asked almost as much as “paper or plastic?” and “debit or ...