As an experienced tax accounting company, what accounting method should I choose?
The most common accounting methods for traders are cash, accrual, and mark-to-market. No one of these methods is better than the other, as the best method depends on the circumstances and preferences of the individual. Under the cash method of accounting, income and expenses are generally recognized when cash actually changes hands. For example, you order supplies and receive them on 12/10/2010 but you do not actually pay for the supplies until 01/03/2011. You would not report the expense on the income tax return until 2011. Under the accrual method of accounting, income and expenses are generally recognized when they are incurred. For example you order supplies and receive them on 12/10/2010 but you do not actually pay for the supplies until 01/03/2011. You would report the expense on the 2010 income tax return. The mark-to-market method of accounting is similar to the accrual method when recognizing most types of income and expense. However, the mark-to-market method of accounting is
