Under cash-basis accounting, stockholders' equity is increased when company makes a sale, not when the company collects the cash at a later date.

Name: Under cash-basis accounting, stockholders' equity is increased when company makes a sale, not when the company collects the cash at a later date.
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Question

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Under cash-basis accounting, revenues are recorded only when cash is received, not when a sale is made. Therefore, stockholders' equity increases when cash is collected, not at the time of sale.

Under Cash-Basis Accounting, Stockholders' Equity Is Increased When Company Makes