The cash basis of accounting works best when a lengthy delay exists between the timing of cash flows and the underlying business activities to which they relate.
BT: Comprehension

Question

Quizplus · Accepted Answer

The cash basis of accounting is not suitable for situations with lengthy delays between cash flows and business activities, as it records transactions only when cash changes hands, potentially misrepresenting the financial position.

The Cash Basis of Accounting Works Best When a Lengthy