Accural Ac

What are the benefits in maintaining Accrual accounting instead of cash ac? In both cases our profit/loss is going to be constant.

1 Answer(s)


in both cases profit/loss will not be the same. They will differ.

For example if a customer paid you Rs.10 lacs this month for a service that will be delivered over 3 months, then in cash accounting your revenue will be Rs.10 lacs and in accrual accounting your revenue will be Rs. 3,33,333 (10lacs/3)