Cash basis accounting measures financial performance very well when a business sells its customers on account.

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Quizplus · Accepted Answer

Cash basis accounting only records transactions when cash is received or paid. It does not record accounts receivable or accounts payable, so it may not fully reflect a business's financial performance if it sells to customers on account. Accrual basis accounting would be more accurate in this scenario.

Cash Basis Accounting Measures Financial Performance Very Well When a Business