Cash vs. ACCRUAL system of accounting (which do I use as a bookkeeper?)

Cash vs. ACCRUAL system of accounting (which do I use as a bookkeeper?). This includes a QuickBooks Online tutorial on how to switch reports between cash and accrual, and also how to change the default in your QBO settings. Business owners can choose if they want to use accrual (which shows outstanding invoices/bills) or cash (which shows just the literal cash in your bank account).


Things mentioned in video:

☑️My favorite bookkeeper training (affiliate links)

☑️Classes taught by me

☑️Free stuff

☑️Pass the ProAdvisor Test: Fast and Easy QBO (affiliate links)

☑️Other awesome classes (affiliate links)

▶ Videos to get started bookkeeping:

▶ More videos you'll like:

#bookkeeper #finepoints #bookkeeping

[beccaboo]

Just saw a fb add from intuit with you in it!! Congrats on the recognition!!

[heathertrinh]

Thanks for always explaining a variety of topics Morgan! I started Bookkeeper Launch last year --no clients yet, but determined to keep going🙂

[anastasiatroup]

Thank you for explaining the difference between accrual and cash. I do my husbands bookkeeping, and we use the cash method because it helps with paying into our personal account vs accrual. I do keep track of his invoices as they come in. Hopefully, in the future we’ll be in a financial place to use accrual.

[rickeyhughes]

Thank you for sharing your most recent video on Cash vs. Accrual.
As you know, I have a small business in Bookkeeping and Accounting. It is also a home based business. I am currently using the cash basis in my business. In some cases, I believe I am using the accrual basis when money is owed to me. I hope I understand what you were saying in the video about the cash and accrual basis, because I am currently using both of them. Please let me know if this is possible. Again, I thank you for sharing your most recent video concerning this.

[KBlue]

Thank you for this explanation. I definitely use the cash system in my business. I don't want to think I have money in my account and I don't. You never now what can happen. I think the only annoyance is at the end of the year when you want a Dec billing to be received in Dec but its recorded in January. 🤷🏾‍♀ Besides the one rule you mentioned seems this is a personal preference? Although I can see for A/P purposes you would want to note what is owed to ensure you have the money.

[Violetjade]

Thank you, Morgan and Team! This explains it so well!

[haroldgonzalez]

Sorry for the question but I’m a new to this. Wouldn’t a business want to know exactly how much money is available at any given time. Therefore the “cash” system is more accurate. I’m just trying to understand which system would be best for a small business.

[arthurbrown]

You may have explained this elsewhere but for small business attorney firms should you use cash or accrual accounting. I have heard the arguments for both sides but am still uncertain. Especially if you are trying to use QBO only. Can you enter items like acct receivable and payable and still use cash accounting?

[reaganhernandez]

do these methods affect A/P and A/R I'm trying g to figure out if we do cash method, willing still have accounts payable in my balance sheet

[reaganhernandez]

what if my client worked in December.. but didn't get paid until January.. for tax purposes does it matter that he got paid Jan... 😊 he is an s corp and he pays himself like a w2 employee

[reaganhernandez]

what if my client worked in December.. but didn't get paid until January.. for tax purposes does it matter that he got paid Jan... 😊 he is an s corp and he pays himself like a w2 employee