converting net income of cash basis to accrual basis

Jun 5, 2015
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In Illustration 2-18 Cash to Accrual, "increase in accounts receivable" and "decrease in accrued liabilities" are "increase in unearned revenues" is deducted to calculate accrual net income from cash basis net income.

But I had learnt that revenues plus gains less expenses and losses for a period equals net income or net loss, the so-called bottom line of the income statement.

"Increase in accounts receivable" is increase in assets; "increase in unearned revenues" is increase in liabilities, and so is "decrease in accrued liabilities".

Why assets and liabilities, not revenues or gains and expenses or losses, are included in accrual calculating net income? Is the author confusing assets with revenues or gains, and liabilities with expenses? Or is there something I have missed?


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