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It’s Just Lunch” is a nationwide service company that arranges lunch dates for clients. “It’s Just Lunch” collects cash up front for a package of dates. Suppose your group is opening an “It’s Just Lunch” office in your area. You must make some important decisions—where to locate, how to advertise, and so on—and you must also make some accounting decisions.
- Will the business use the cash basis or the accrual basis of accounting? Give a complete explanation of your reasoning.
- How often will financial statements be prepared? Why? Discuss how the business will use each financial statement.
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