Why financial literacy is important in education.
The main difference in accrual based accounting and cash based accounting is in the timing of when revenues and expenses are recognized. In accrual based accounting, revenues and expenses are recorded when they are incurred, and before the cash transaction happens. This method follows the matching cRead more
The main difference in accrual based accounting and cash based accounting is in the timing of when revenues and expenses are recognized.
In accrual based accounting, revenues and expenses are recorded when they are incurred, and before the cash transaction happens. This method follows the matching concept, which ensures that the revenues and their expenses are recorded in the books of accounts in the financial period. Accrual accounting provides an accuracy of a company’s financial position and performance because it involves accounts receivable and accounts payable. For example, if a company delivers goods in December but receives payment in January, the revenue is recorded in December under accrual accounting.
In Cash based accounting, revenues and expenses are recognized only when the cash is actually received or paid. It is simpler and often used by sole proprietorship and individuals because it gives a clear view of cash flow. For example, Under cash accounting, the revenue would be recorded in January when the payment is received, not when the goods were delivered.
Both the methods have their own pros and are chosen to their specific needs and requirements of the business.
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Hii there, here the answer that I want to share with you by my opinion.. Financial literacy is important in education as it empower individuals by economic stability, provide social benefits like economic growth and reducing poverty . And apart from empowering and social benefits it enhance individuRead more
Hii there, here the answer that I want to share with you by my opinion..
Financial literacy is important in education as it empower individuals by economic stability, provide social benefits like economic growth and reducing poverty .
And apart from empowering and social benefits it enhance individual pratical skills like budgeting and Saving and also people learn credit management.
Financial literacy equips individuals with the knowledge to make informed decisions about their money, such as budgeting, saving, investing, and managing debt for long term financial health and for economic stability.
Here the answer from my side hope you understand it well and I may answer it again in easy way if you face any problem.
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