But Krauss said that from the moment he and the other scientists arrived on the island, they never saw anything untoward.
COMPANIES THAT FAIL THE $1 MILLION AVERAGE revenue test are not affected by the revenue procedure. For them, determining whether to use the cash or accrual method hinges on two issues: the material income-producing factor test and their type of entity. COMPANIES SELLING MERCHANDISE GENERALLY must use the accrual method to account for purchases and sales.
Basis of Accounting. To convert between the accrual basis of accounting and the cash basis of accounting, we must remember that in the accrual basis, revenues are recognized when earned. (rather than when cash is received) and expenses are recognized when incurred (rather. than when paid). In the cash basis, we are only interested in cash receipts, cash. payments, and net change in cash resulting from operating, investing, and financing. activities during a period.