capitalizing
How does capitalizing expenses work with cash basis accounting? If we are capitalizing for past expenses that were paid and cash received in this period? Thanks!
How does capitalizing expenses work with cash basis accounting? If we are capitalizing for past expenses that were paid and cash received in this period? Thanks!
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If you are capitalizing, you aren't working on a true cash basis -- rather a "modified" cash basis.
If you are going this route, I'd hang up the fixed assets AND any long-term liabilities on your balance sheet. D&A as you would under accrual basis, but run everything else on a cash basis.
that said, I'm not a CPA but rather a finance guy who recently ran the acquisition of a few small groups that used the cash basis. YMMV.
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