cash method of accounting


cash method of accounting
A method of accounting in which income is accounted for when actually received (not, for instance, when an order is taken) and expenses are reported when actually paid (not when liability for paying them is incurred, such as making an order). Compare: accrual method of accounting
Category: Business, LLCs & Corporations → Business Accounting, Bookkeeping & Finances
Category: Business Cash Flow Problems & Bankruptcy
Category: Business, LLCs & Corporations → Business Tax & Deductions
Category: Personal Finance & Retirement → Taxes → Tax Audits

Nolo’s Plain-English Law Dictionary. . 2009.

Look at other dictionaries:

  • cash method of accounting — Cash method. The practice of recording income and expense only when cash is received or paid out; used in contradistinction to accrual method. See cash basis accounting. See also accounting …   Black's law dictionary

  • cash method — cash meth·od n: cash basis at basis Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. cash method …   Law dictionary

  • cash method — Cash method. The practice of recording income and expense only when cash is received or paid out; used in contradistinction to accrual method. See cash basis accounting. See also accounting …   Black's law dictionary

  • method of accounting — noun a bookkeeper s chronological list of related debits and credits of a business; forms part of a ledger of accounts • Syn: ↑accounting, ↑accounting system • Derivationally related forms: ↑account (for: ↑accounting) • …   Useful english dictionary

  • accrual method of accounting — A method of accounting in which income is accounted for when earned (not received) and expenses are accounted for when liability for paying them is incurred (not when they are paid). Compare: cash method of accounting Category: Business, LLCs &… …   Law dictionary

  • Comparison of Cash Method and Accrual Method of accounting — A comparison of the two primary accounting methods (Cash method and Accrual method) used to calculate taxable income for U.S. Federal income taxes. According to the Internal Revenue Code, a taxpayer may compute taxable income under the following… …   Wikipedia

  • Accounting methods — Cash basisCash basis accounting is a method of bookkeeping that records financial events based on cash flows and cash position. Revenue is recognized when cash is received and expense is recognized when cash is paid. In cash basis accounting,… …   Wikipedia

  • accounting — ac‧coun‧ting [əˈkaʊntɪŋ] noun [uncountable] 1. ACCOUNTING JOBS the usual word for the profession of accountancy in the US 2. ACCOUNTING the work of keeping a company s financial records, recording its income and expenses, and its business deals:… …   Financial and business terms


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