LessAccounting allows you to track finances based on a cash-based business or an accrual-based business. Here is the difference:
Cash: The cash method is the more commonly used method of accounting in small business. Under the cash method, income is not counted until cash (or a check) is actually received, and expenses are not counted until they are actually paid.
Accrual: The accrual method. Under the accrual method, transactions are counted when the order is made, the item is delivered, or the services occur, regardless of when the money for them is actually received or paid.
For example: If you send an invoice to a client for $100, under the CASH method, you'd consider that $100 income when you receive the $100. Under the accrual method, you'd consider that $100 income when you invoice for it, regardless if you actually ever get that money or not.