Which of the following stanemets is correct regarding the use of the cash accoun

Question

Which of the following stanemets is correct regarding the use of the cash account in deferral and accrual edjustments at the end of the accounting period? O Transactions involving cash are often inclued in both accrual and deferral adjustments at the end of the accounting period O The Cosh acount can only be used in a deferral adjusmen, but not in an accrual adjustment O Cash is never involved in end-of-period deferail or accrual adjustments The Cash account can only be used in an eccrual oduserent but not na deferral ohustment DOLL 8 Alt CtL Alt

Explanation / Answer

1) Answer (C) cash is never used in end of period deferral or accrual adjustments.

Explanation : Normally we used to defer or accrue the revenues and expenses by posting adjusting entries to show the true income or loss for the accounting period.But cash transactions will be posted when ever the cash transactions happens and there will be no deferral or adjustment to the transactions involving cash.

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