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

The Financial Statements

Financial Accounting

1. Introduction to Accounting

The Financial Statements

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Multiple Choice

Which formula best expresses your monthly ending balance on a financial statement?

Beginning Balance + Total Inflows - Total Outflows = Ending Balance

Beginning Balance - Total Inflows + Total Outflows = Ending Balance

Total Revenues - Total Expenses = Ending Balance

Assets + Liabilities = Ending Balance

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Verified step by step guidance

Understand the concept of an ending balance: It represents the final amount in an account after accounting for all inflows (additions) and outflows (subtractions) during a specific period.

Review the formula options provided in the problem. The correct formula should logically account for the beginning balance, inflows, and outflows to calculate the ending balance.

Analyze the first formula: 'Beginning Balance + Total Inflows - Total Outflows = Ending Balance'. This formula correctly incorporates the starting balance, adds inflows, and subtracts outflows to arrive at the ending balance.

Evaluate the other formulas: The second formula incorrectly subtracts inflows and adds outflows, which does not align with the logic of calculating an ending balance. The third formula relates to net income (revenues minus expenses) rather than ending balance. The fourth formula represents the accounting equation (Assets = Liabilities + Equity), which is unrelated to ending balance.

Conclude that the first formula, 'Beginning Balance + Total Inflows - Total Outflows = Ending Balance', is the correct representation for calculating the monthly ending balance on a financial statement.