Business FinancesQuestion 289 of 1605
Under the cash basis of accounting, a contractor records revenue when:
a.Cash is actually received from the customer
b.The invoice is mailed to the customer
c.The contract is signed
d.The work is 50% complete
Explanation
Cash-basis accounting recognizes revenue when payment is received and expenses when they are paid. Accrual accounting, by contrast, records revenue when earned and expenses when incurred, regardless of cash movement.
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