Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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Multiple Choice

In financial accounting, an owner's distribution is classified as which type of account?

Equity account

Asset account

Revenue account

Liability account

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Verified step by step guidance

Understand the concept of an owner's distribution: It refers to the withdrawal of assets (usually cash) by the owner from the business for personal use. This reduces the owner's equity in the business.

Recall the classification of accounts in financial accounting: The main types of accounts are Assets, Liabilities, Equity, Revenue, and Expenses.

Analyze the impact of an owner's distribution: Since it reduces the owner's equity in the business, it is directly related to the Equity account.

Eliminate incorrect options: An owner's distribution does not increase assets, liabilities, or revenue. Therefore, 'Asset account,' 'Liability account,' and 'Revenue account' are incorrect.

Conclude that the correct classification for an owner's distribution is an Equity account, as it directly affects the owner's equity in the business.