Natalya reports profits when cash is received and records expenses when they are paid. She is using
A) a statement of cash flows.
B) accrual-basis accounting.
C) cash-basis accounting.
D) liquid assets.

Question

Quizplus · Accepted Answer

Natalya is using cash-basis accounting, which recognizes revenue when cash is received and expenses when they are paid. This method does not recognize accounts receivable or accounts payable.

Natalya Reports Profits When Cash Is Received and Records Expenses