Discover how accruals affect company finances, with insights into the accrual accounting method, its applications, and examples illustrating its principles.

There are two main types of business accounting methods: cash and accrual. In general, small-business owners have the option to choose which one to use. Both methods function to keep track of income ...

Accrual accounting is the GAAP-preferred practice of recording all revenues and expenses when they occur, even if payment has not yet been sent or received. In business, all financial transactions ...

A prepaid asset is an expenditure of money in advance of when the money is due. For example, you might pay up front for a year's rent or insurance, even though the payments are due monthly. Under ...

The ratable accrual method is a formula for determining income on investments as it's accrued rather than paid and is often used for income tax purposes.

Should small businesses use cash or accrual accounting? This question gets asked almost as much as “paper or plastic?” and “debit or credit?” While the IRS requires some companies to use accrual ...

Private business owners need to understand the difference between cash and accrual accounting methods to accurately interpret their company's financial health. LONG ...

Should small businesses use cash or accrual accounting? This question gets asked almost as much as “paper or plastic?” and “debit or credit?” While the IRS requires some companies to use accrual ...

Opinions expressed by Entrepreneur contributors are their own. Should small businesses use cash or accrual accounting? This question gets asked almost as much as “paper or plastic?” and “debit or ...