Many governments budget on the cash basis. Explain why a government would budget on a cash basis rather than on a GAAP-basis. What basis of accounting would you recommend for a municipality budget? Explain and justify your selection.

Many governments budget on the cash basis. Explain why a government would budget on a cash basis rather than on a GAAP-basis. What basis of accounting would you recommend for a municipality budget? Explain and justify your selection.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Budgeted Income Statement

Accounting is the process of recording business-related financial transactions. The process of accounting involves summarizing and analyzing the transactions. The financial statements which are prepared in accounting contain a summary of the various transactions that took place within a certain accounting period. Book-keeping or accounting is one of the most important activities of any business.

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