Question

Which of the following is a disadvantage of accrual basis accounting? A. It tracks money going out, but not money coming in. B. There aren't any good software programs for accrual basis accounting. C. It is difficult to see how much money the company owes. D. It is difficult to see a company's cash flow.

Answer 1

D it's difficult to see a companies cash flow

Answer 2

D. It is difficult to see a company's cash flow.

Step-by-step explanation:

Accrual basis accounting is a method for recording transactions in which revenues are reported when they are earned and expenses when they are incurred. It means that in this method the cash in and out is not the focus as it is on the moment the earnings or expenses generate. According to this, one of the disadvantages with accrual basis accounting it that it is difficult to see a company's cash flow because it is not focus on the cash received or payed.