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

Activity-based costing (ABC) can be used by service providers who usually classify costs by:

departments

time periods

customer type

activities performed

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Verified step by step guidance

Understand the concept of Activity-Based Costing (ABC): ABC is a costing method that assigns costs to products or services based on the activities and resources consumed during production or service delivery.

Recognize the importance of activities in ABC: Activities are the fundamental building blocks in ABC, as costs are traced to activities and then allocated to products or services based on their usage of those activities.

Identify the classification of costs in ABC for service providers: Service providers typically classify costs based on the activities performed rather than departments, time periods, or customer types. This ensures a more accurate allocation of costs.

Compare the options provided: Evaluate why 'activities performed' is the correct classification in ABC, as it aligns with the methodology of tracing costs to specific activities rather than broader categories like departments or customer types.

Conclude with the correct answer: Activities performed are the basis for cost classification in ABC, as this approach provides a detailed and precise understanding of cost allocation in service-based organizations.