Accrual Accounting

Ahmed Ali
What Is Accrual Accounting?

• Accrual Accounting is an accounting method where revenue or

expenses are recorded when a transection accour rather then when
payment receive or made.
• Also called cash accounting.
• In the real world things are different costumer don’t always pay in
cash they often buy some things and pay later. When this happened
theseller is owned money and has an account receivable
• Companies don’t pay cash for material and other expences they often
pay latter if this is the case a company has a account payable
Uses in small business
• Manipulation
• Outflow
• A small business owner keeping an accurate amount of your expences
is vital if you are going to keep your business in the blank
• Even if you don’t handle your own financial reporting its vital to know
how each one works
Avoiding Basic of Accounting
• Accounting is important for small business owners as it helps the
owners, managers, investors and other stakeholders in the business
evaluate the financial performance of the business. Accounting
provides vital information regarding cost and earnings, profit and loss,
liabilities and assets for decision making, planning and controlling
processes within a business.
• The main objective of accounting is to record financial transactions in
the books of accounts to identify, measure and communicate
economic information. Moreover, tax reporting agencies require you
to keep books at a minimum level that tracks income and expenditure.