A Brief History Effective July 1, 2009 1. Accounting Standards Codification (ASC) integrated –> accounting standards from all other sources –> into the single “authoritative”
GAAP Hierarchy Statement of Financial Accounting Standards No. 168, June 2009 “The FASB Accounting Standards Codification and the Hierarchy of GAAP” Two levels of
Adjusting entries are prepared to adjust account balances from cash basis to accrual basis. © AccountingInfo.com
Accruals Accrued revenues and expenses are recognized before cash is received or paid. Under accrual basis accounting, revenues are recognized when they are earned even
CASH BASIS ACCOUNTING Under cash basis accounting, revenues are recognized when cash is received and expenses are recognized when cash is paid. ACCRUAL BASIS ACCOUNTING
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