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Which statement best explains Accrual basis?

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Question ID #25880 UPSC UPSC EPFO APFC 2026 Mock Test Series UPSC EPFO APFC Accounting Principles Sectional Test 2026 Medium

Which statement best explains Accrual basis?

Correct Answer: D. Recognition of income and expenses when earned or incurred rather than only when cash moves
Accrual basis: Recognition of income and expenses when earned or incurred rather than only when cash moves

Question: Which statement best explains Accrual basis?

A. Book of original entry in which transactions are first recorded chronologically

B. Estimate of receivables that may become uncollectible

C. Expense incurred but not yet paid

D. Recognition of income and expenses when earned or incurred rather than only when cash moves

Correct Answer: D. Recognition of income and expenses when earned or incurred rather than only when cash movesAccrual basis: Recognition of income and expenses when earned or incurred rather than only when cash moves

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Which statement best explains Accrual basis? - MCQ Explanation

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Correct answer: D. Recognition of income and expenses when earned or incurred rather than only when cash moves