The justification for the accrual basis of accounting lies in the needs of financial statement users for periodic information on the financial position and the profitability of the entity.

Question

Quizplus · Accepted Answer

The accrual basis of accounting provides a more accurate representation of a company's financial position and profitability, which is important information for financial statement users to make informed decisions. Therefore, the statement is true.

The Justification for the Accrual Basis of Accounting Lies in the Needs