In my accounting class we are being asked to respond to posts that are posted by other students. Below is the post I need help with responding to. Any help you can give me would be appreciated! I MUST include a reference in my response so if you could include a reference that would be so helpful! THANK YOU!

cash basis accounting is Cash basis. Revenue is recorded when cash is received from customers, and expenses are recorded when cash is paid to suppliers and employees (Bragg, 2019). Accrual basis accounting is Accrual basis. Revenue is recorded when earned and expenses are recorded when consumed (Bragg, 2019). For a small business cash basis accounting is common because it is simpler as well as it only shows actual cash in hand, granted it does not show expenses paid until they are actually paid, I have seen many cases where a business is waiting on funds from a customer and it takes longer than expected, meaning it could hurt a business if its accounting shows it has funds that have been earned, but not paid yet. Accrual basis accounting seems to be more commonly used in larger corporations for tax purposes, because audits are done using the accrual method when sales exceed 5 million (Bragg, 2019). The accrual method is better at assessing the true profit of a business in the same reporting period versus the cash method. I do not think one method is better than another. Like many other things related to business decisions it depends on an organizations individual situation.