The cash-basis and accrual-basis accounting equations recognize owner contributions equivalently. TRUE OR FALSE?

Expert Solution

TRUE

Because Accrual accounting involves stating revenues and expenses as they occur, not necessarily when cash is received or paid out and Cash accounting is an accounting method where payment receipts are recorded during the period in which they are received, and expenses are recorded in the period in which they are actually paid.

So it is about which method we have to follow whether cash or accruel but it recognize owner contributions equivalently in both accounting equation i.e. cash or accruel accounting equation.

ekkarill92 answered 2 years ago

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