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

3. Accrual Accounting Concepts

Closing Entries

Financial Accounting

3. Accrual Accounting Concepts

Closing Entries

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Multiple Choice

When does the dissolution of a partnership occur?

When the partnership issues new shares of stock

When any partner withdraws or a new partner is admitted

Only when the partnership's net income is negative

Only at the end of the fiscal year during closing entries

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Verified step by step guidance

Understand the concept of partnership dissolution: In financial accounting, the dissolution of a partnership refers to the process where the existing partnership agreement is terminated due to changes in the partnership structure.

Identify the key triggers for dissolution: A partnership is dissolved when there is a significant change in the composition of partners, such as when a partner withdraws or a new partner is admitted. This alters the original agreement and requires a new arrangement.

Clarify misconceptions: Dissolution does not occur due to issuing shares of stock, as partnerships do not issue stock. It also does not depend solely on the partnership's net income being negative or the fiscal year-end closing entries.

Relate to accounting procedures: Upon dissolution, the partnership's accounts are adjusted to reflect the changes in ownership. This may involve revaluation of assets, settlement of liabilities, and distribution of remaining equity among partners.

Summarize the correct answer: The dissolution of a partnership occurs when any partner withdraws or a new partner is admitted, as this fundamentally changes the partnership agreement.