Accrual Accounting: How it Works & Why it's #1!

Accounting Basics Lesson 8. In this episode of Accounting Basics for Beginners we take on the question - which is better? The Accrual Basis of Accounting or the Cash Basis?

This episode of Accounting Stuff - Accounting Basics Lesson 8 - is a continuation of our series on Basic Accounting for Beginners. In this tutorial, you will learn:

▪ The definition of the Accruals Basis of Accounting.
▪ Accrual vs Cash Basis - Why is Accrual Accounting better than Cash Accounting?
▪ This will be demonstrated using examples comparing both the accrual method and cash method.
▪ The importance of the Matching Principle.
▪ The Pros and Cons of Accrual Basis of Accounting.

⏱️TIMESTAMPS
00:00 - Intro
01:30 - The Problem with the Cash Basis of Accounting
01:49 - What is the Accrual Basis of Accounting?
02:07 - How does the Accrual Basis of Accounting Work
03:59 - What is the Matching Principle?
04:45 - Advantages of Accrual Accounting
05:14 - Disadvantages of Accrual Accounting
06:07 - Which Method of Accounting Should a Start-up Use?

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