In cash basis accounting, companies record revenues when they receive the cash and they record expenses when the cash is paid. Cash basis accounting records only cash transactions—cash receipts and cash payments. Basically, it is a simple method. But it prevents businesses from being cautious. Companies adopting cash basis accounting focus only transactions involving cash. Those with no monetary input are not taken into consideration. It is possible to say that cash basis accounting is mostly used by small businesses. The correct answer is A.