I will be looking at the Tesco Plc Annual Report and Financial Statements 2014 in this week’s learning journal since it is the company I chose in my week 1. Before I delve into discussing whether I think they use accrual-based account or cash-based accounting I will like to define the terms.
Accrual basis accounting simply means the process of recording revenue and expenses as they take place even though there has not been an exchange of cash, while, cash basis accounting as the name typifies is the opposite of accrual basis accounting. It is the process of recording revenue when cash is collected and expenses when cash is paid out, irrespective of the time scale.
However, since revenue and expenses are calculated differently in both accrual
Accrual basis accounting simply means the process of recording revenue and expenses as they take place even though there has not been an exchange of cash, while, cash basis accounting as the name typifies is the opposite of accrual basis accounting. It is the process of recording revenue when cash is collected and expenses when cash is paid out, irrespective of the time scale.
However, since revenue and expenses are calculated differently in both accrual