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Cost accounting basics

Define accrual accounting:

If you are an experienced business owner and don't know the answer to this question, then you need to call our offices today. Speaking in great generalities, accrual accounting seeks to bring all of the proper accounting transactions into the proper accounting period of time.

Let's use an example.

You send someone a bill for work that you completed in January. Payment is received and deposited in March. From the standpoint of accounting, when is that transaction considered income? Is it in January when you did the work, or in March when you received the payment?

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