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Modified accrual accounting (view source)
Revision as of 15:02, March 3, 2018
, 15:02, March 3, 2018new article
In accounting, '''modified accrual accounting''' (also called '''modified cash accounting'''), is a hybrid form of [[cash accounting]] and [[Accrual Accounting|accrual accounting]].
It generally works like cash accounting, in that revenues are recorded when payment is received, and expenses are recorded when payment is made. However, like accrual accounting, long-term assets are capitalized and subject to [[depreciation]] or [[amortization]], and long-term liabilities are recorded as debt and reduced as payments are made.
Modified accrual accounting is commonly used by governmental entities and non-profit organizations.
It generally works like cash accounting, in that revenues are recorded when payment is received, and expenses are recorded when payment is made. However, like accrual accounting, long-term assets are capitalized and subject to [[depreciation]] or [[amortization]], and long-term liabilities are recorded as debt and reduced as payments are made.
Modified accrual accounting is commonly used by governmental entities and non-profit organizations.