The major objectives for business entity are to earn profit. Every company keeps their financial records and prepares their financial reports. There are two main accounting methods which are used to keep recording of the business. They are cash basis accounting (cash method) and accrual basis (accrual method). Compare and Contrast Cash Basis Accounting and Accrual Basis Accounting. In your discussion define each method. Explain the differences between the two methods and give an example. Give examples of business that are required by law to use Accrual Basis Accounting Instructions: Your initial response should be no less than 250 words with at least one scholarly journal reference (dictionary-type websites are excluded). Reply to at least two of your classmates. Replies to classmates should be a minimum of 100 words and include direct questions. In-text citations and references must be in APA format. Refer to the Forum Grading Rubric below for additional guidelines. Make sure you are using credible sources in your discussions and assignments. Scholarly journals are the preferred source of credible/quality references. These consist of peer-reviewed articles published in academic journals related to the field, which are found via our Library. Websites such as Investopedia, ask.com, answers.com, or dictionary-type of websites limit the insight to the topics. Wikipedia is not acceptable as it is not a reliable, credible source of reference. The purpose is to bring in new information and how does it apply to our topic from a real-world perspective, instead of extending on definitions that are found in the book. More information what a credible source consists of can be found here: http://writingcommons.org/evidence/supporting-sources/630-what-might-be-a-more-credible-reliable-source.