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Which statement is correct? As long as management is ethical, there are no problems with using the cash basis of accounting. As long as a

Which statement is correct?

  • As long as management is ethical, there are no problems with using the cash basis of accounting.
  • As long as a company consistently uses the cash basis of accounting, generally accepted accounting principles allow its use.
  • The cash basis of accounting is objective because no one can be certain of the amount of revenue until the cash is received.
  • The use of the cash basis of accounting violates both the revenue recognition and expense recognition principles.

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