Which of the following best describes the difference in expense recognition between accrual and cash basis accounting?

• A. Accrual accounting recognizes expenses when the service is received; cash basis recognizes expenses when cash is paid.
• B. Both accrual and cash basis recognize expenses when cash is paid.
• C. Both accrual and cash basis recognize expenses when the service is received.
• D. Accrual accounting recognizes expenses when cash is paid; cash basis recognizes expenses when the service is received.

Answer: (A)