1. Watch Video: Cash and Accrual Conceptual (4:44)
Click here to open the video in a new window.
Based on the video, explain two (2) advantages and two (2) disadvantages in using both the cash and the accrual basis of accounting.
Then, determine the one (1) that you believe provides the most useful financial information to users.
Identify at least two (2) types of businesses that would benefit by preparing financial statements using either the cash or accrual basis of accounting.
2. Accounting Adjustments
Discuss whether or not you believe gift cards should have an expiration date. Based on your response, what is the implication related to the accounting treatment of the transaction.
Discuss closing entries and reversing entries.
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