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

10. Time Value of Money

Time Value of Money Equations

Financial Accounting

10. Time Value of Money

Time Value of Money Equations

Previous problemNext problem

Struggling with Financial Accounting?

Join thousands of students who trust us to help them ace their exams!Watch the first video

Multiple Choice

All of the following are true statements regarding the accumulation at interest option except:

The accumulated amount includes both principal and interest.

Interest earned is typically compounded annually.

The interest rate applied is usually specified in the contract.

Withdrawals can be made at any time without affecting interest calculations.

Previous problemNext problem

Verified step by step guidance

Understand the concept of the accumulation at interest option: This option allows policyholders to leave dividends or other funds with the insurer to accumulate interest over time.

Review the true statements provided: The accumulated amount includes both principal and interest, interest earned is typically compounded annually, and the interest rate applied is usually specified in the contract.

Analyze the exception statement: 'Withdrawals can be made at any time without affecting interest calculations.' This statement implies that withdrawals do not impact the interest earned, which is not typically true in accumulation at interest options.

Clarify why the exception is incorrect: In most cases, withdrawals reduce the principal amount, which directly affects the interest calculations since interest is calculated on the remaining principal.

Conclude that the correct answer is the exception statement: 'Withdrawals can be made at any time without affecting interest calculations,' as it contradicts the typical behavior of accumulation at interest options.