Measuring business income

5.   Measuring business income

5.1      Accrual-basis accounting vs Cash-basis accounting

5.2      Accounting period

5.3      Revenue principle

5.4      Matching principle

5.5      Time period concept

5.6      Overview of the adjusting process

5.7      Adjustments for 

• prepayments (deferrals), 

• accruals, 

• precollections, 

• uncollectible accounts receivable, 

• amortization 

• depreciation of property, plant and equipment

5.8      Preparation of the adjusted trial balance and financial statements

5.9      Use of accounting information for decision making