Asked by Quinn Duncan on May 17, 2024
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Accruals are needed when an unrecorded expense has been incurred or an unrecorded revenue has been earned.
Accruals
Accounting method that records revenues and expenses when they are incurred, regardless of when cash transactions occur.
Unrecorded Expense
A cost or liability that has been incurred but not yet documented or included in the financial records or statements of a company.
Unrecorded Revenue
Earnings from completed transactions or delivered goods/services that have not yet been documented in the financial accounts.
- Understand the fundamentals of accrual-basis accounting and its importance in reporting financial activity accurately.
- Comprehend the purpose of adjusting entries and their role in the accounting cycle.
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Learning Objectives
- Understand the fundamentals of accrual-basis accounting and its importance in reporting financial activity accurately.
- Comprehend the purpose of adjusting entries and their role in the accounting cycle.
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