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

When a company takes out a loan, which of the following is the first accounting entry typically made?

Debit Cash, Credit Notes Payable

Debit Equipment, Credit Accounts Payable

Debit Accounts Receivable, Credit Revenue

Debit Interest Expense, Credit Cash

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Verified step by step guidance

Understand the nature of the transaction: A loan is a liability for the company, and the cash received from the loan increases the company's assets. This means the accounting entry will involve both an asset account (Cash) and a liability account (Notes Payable).

Recall the accounting equation: Assets = Liabilities + Equity. When a loan is taken out, the cash received increases assets, and the liability (Notes Payable) increases as well, keeping the equation balanced.

Determine the accounts involved: The asset account affected is 'Cash,' which increases, and the liability account affected is 'Notes Payable,' which also increases.

Apply the rules of debits and credits: An increase in an asset account (Cash) is recorded as a debit, and an increase in a liability account (Notes Payable) is recorded as a credit.

Record the journal entry: Debit the 'Cash' account to reflect the increase in assets, and credit the 'Notes Payable' account to reflect the increase in liabilities.