| Accrual Basis Accounting | Records revenues when earned and expenses when incurred, regardless of the timing of cash receipts or payments.
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| Cash Basis Accounting | Records revenues when cash is received and expenses when cash is paid.
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| Expenses | Decreases in assets or increases in liabilities from ongoing operations incurred to generate revenues during the period.
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| Gains | Increases in assets or decreases in liabilities from peripheral transactions.
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| Losses | Decreases in assets or increases in liabilities from peripheral transactions.
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| Matching Principle | Requires that expenses be recorded when incurred in earning revenue.
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| Operating Cycle (Cash-to-Cash Cycle) | The time it takes for a company to pay cash to suppliers, sell those goods and services to customers, and collect cash from customers.
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| Revenue Principle | Revenues are recognized when goods or services are delivered, there is evidence of an arrangement for customer payment, the price is fixed or determinable, and collection is reasonably assured.
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| Revenues | Increases in assets or settlements of liabilities from ongoing operations.
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| Time Period Assumption | The long life of a company can be reported in shorter time periods.
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