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Simple English definitions for legal terms

accrual accounting method

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A quick definition of accrual accounting method:

The accrual accounting method is a way of keeping track of money for taxes. It records when a debt or expense happens, rather than when the money is received or paid out. This is different from the cash-basis accounting method, which only counts money that has been received or paid out. Other accounting methods include cost accounting, fair-value accounting, and percentage-of-completion method.

A more thorough explanation:

The accrual accounting method is a system used to determine income and expenses for tax purposes. It records entries of debits and credits when the liability arises, rather than when the income or expense is received or disbursed. This is also known as the accrual basis.

  • Cash-basis accounting method: This is an accounting method that considers only cash actually received as income and cash actually paid out as an expense. For example, if a business receives payment for a service in January but doesn't provide the service until February, the income would be recorded in February under the accrual accounting method, but in January under the cash-basis accounting method.
  • Percentage-of-completion method: This is an accounting method in which revenue is recognized gradually during the completion of the subject matter of the contract. For example, if a construction company is building a house for a client, revenue would be recognized as the project progresses, rather than all at once when the project is completed.

These examples illustrate how the accrual accounting method differs from other accounting methods, such as the cash-basis accounting method. The accrual accounting method focuses on when the liability arises, rather than when the income or expense is received or disbursed.

accrual, clause of | accrual basis

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15:06
tht sounds so fun omg
15:07
i need a hobby when ppl ask u guys what u do for fun do u know what to say like
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i enjoy watchig reels
I do enjoy watercolor painting, but I believe language used on my resume was "Watercolor painting, reading general fiction novels, digital architecture and interior design, travel"
i knit, read, do solidcore, sew, bike, and im in a mahjong league
15:17
i like to bake cookies, go in the woods, race, shoplift, and get drunk once a week
if you say you read no one will question you bc most people don’t read these days
i read but yeah its fourth wing sue me
@legallybrunettelily: is it any good? i haven't read fantasy in years bc booktok irks me
i think its is amazing nd i hate 90% of booktok
they get worse over time though
like the first two are good
sold ty i was thinking of reading more fantasy today while driving to work
i, shamelessly, was a very big fan of pretty much everything Sarah J. Maas for years and years, but that was so polluted by booktok that it makes me cringe. very fun read for young me tho
Mostlylegal
15:45
notre dame straightup a figment of my imagination
me w luc
eggan
15:47
i waited berk for 5 months and then WL :(
eggan
15:47
im stil salty
Mostlylegal
15:48
ugh
Mostlylegal
15:48
im on three months rn
im on four
Mostlylegal
15:49
i think i will never hear back from vandy atp
and i have a seat deposit due on the 7th
Mostlylegal
15:49
that or a WL augst 28th
hobbies: gossiping w my gbf, coffee, & being a brat lol
Mostlylegal
15:50
drinking coffee is a hobby?
you could totally spin coffee drinking into a hobby. i know there are straightup barista competitions
globalcitizen
15:52
libtards should relax about the teslas, its a pretty good car if you live in the city
globalcitizen
15:53
the cybertruck looks kinda cool
apropos of nothing
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