RECOGNITION AND MEASUREMENT

OF CASH
Recognition of cash
Payment receipts are recorded during the
period which they are received.
Expense are recorded in the period when they
are actually paid.

Cash transactions are recognized and recorded

ONLY when money goes in and out of an
account.
Example:
A car company sells a brand new car to a
costumer that is payable for 8 months.

A company is liable to pay P10,000 to AN

advertising company for making an
advertistment of their product. Payable until the
first airing of the said advertisment.
Derecognition of cash
• Derecognition occus whenever an asset is
disposed of or not expected to provide any
future benefits from either its use or
disposal. As a result, the asset is removed
from the financial statement.

• Selling, exchanging, abandoning or donating

it.
Derecognition of cash
Example:
A business donated cash amounting 100,000
to a charity concert.