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In other words, revenues and expenses are recorded when cash is received and paid, respectively. Buy It Now. What Is Cash Accounting? Genre see all.
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Accrual accounting is an accounting method that measures the performance of a company by recognizing economic events regardless of when the cash transaction occurs. Sold Items. Rock Music in Other Formats. Record Grading see all. A main drawback of cash accounting is that it may not provide an accurate picture of the liabilities that have been incurred i. No Preference. On the other hand, cash accounting also means that a business that has just completed a large job for which it is awaiting payment may appear to be less successful than it really is because it has expended the materials and labor for the job but not yet collected payment.
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