Accounting- Financial Accounting, Cash vs Accrual Accounting

Name: Accounting- Financial Accounting, Cash vs Accrual Accounting
Rating: 4.2 (788 reviews)

Why use Accrual Accounting; Gaps in Cash Accounting; Prepare financial statements under both methods; financial analysis

Created bySandesh Banger

Last updated 8/2020

English

What you'll learn

Excel based exercise on how business transactions will differently impact Cash Accounts and Accrual Accounts
What makes Accrual Accounting so powerful that the entire world uses it?
Learn to prepare P&L and Balance Sheet in Cash Accounting vs Accrual Accounting.
Uncover the untold story of why we don’t use Cash accounting?
Learn to understand finer aspects of financial statements

Course content

1 section • 10 lectures • 33m total length

Course Preview1:39
Discover the difference between cash and accrual accounting, learn to record transactions under both methods, and understand why accrual accounting offers more information for investors and analysts.
Introduction to Cash & Accrual Accounting1:20
Business Transactions2:00
Compare cash-based and accrual accounting through business transactions, noting revenue recognition on Tuesday versus Wednesday and expenses recorded when incurred, then explore the balance sheet with an Excel exercise.
Additional Info0:56
Compare cash-based and accrual accounting through a week-long profit and loss and balance sheet, with cost price 60 and selling price 100, yielding 40 profit per sale.
Listing Transactions2:07
Cash Accounting - P&L and Balance Sheet7:25
Accrual Accounting - P&L and Balance Sheet10:03
Learn accrual accounting through a day-by-day walkthrough of inventory, revenue recognition, and the matching principle, showing how advances from customers, liabilities, and payables shape the balance sheet and P&L.
Consolidated Accounts & Insights5:55
Important Learning & Summary1:54
Compare cash-based and accrual-based accounting to reveal how accrual accounting shows assets, liabilities, and a true daily performance on the balance sheet, guiding investors and analysts.
Resources0:40

Requirements

Basic knowledge of Finance & Accounting

Description

Let's discover the untold story of Cash vs Accrual Accounting.

If you are an accounting or finance enthusiast, this mini course is for you.

Have you ever thought why Accounting has to be complex? Why someone made Accrual Accounting? Why it can’t be simple? Why don’t we use the simple Cash based Accounting? I bet you have.

I will tell you the answer. And for that we need to understand how business accounts will look like if we use Cash Accounting vs Accrual Accounting. And we will learn that in this course.

One thing is sure that Accrual Accounting is used by the whole world. That means it has to have certain characteristics which make it powerful. What are these, let’s find out.

In this mini-course I’m going to take you through an excel based exercise on creating accounts using cash based and then using accrual based accounting. So, that we can compare the two and figure out interesting insights.

I teach this module in b-schools and students find it an incredible insight, never told before.

By realizing what lies at the core of accounting, you will not only appreciate accounting methods but will also be equipped with the right mindset to learn. It will enable you to better analyse the financials of any company.

Contents and Overview This course includes 10 lectures and just over 30 minutes of content in order to give students a working knowledge and an invaluable insight into Accounting.

What you’ll learn

At the end of this course you have following takeaways

You will be well versed with Cash vs Accrual Accounting
You will be able to record basic transactions in Cash as well as Accrual Accounting
You will have an invaluable insight into the science behind of Accounting

Who this course is for:

Students of Accounting and Finance