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

Which of the following statements about liabilities is true?

Liabilities are recorded as revenue on the income statement.

Liabilities represent obligations that a company must settle in the future.

Liabilities decrease when a company borrows money from a bank.

Liabilities are resources owned by a company.

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Verified step by step guidance

Step 1: Understand the definition of liabilities. Liabilities are obligations that a company owes to external parties, which must be settled in the future, typically through the transfer of money, goods, or services.

Step 2: Analyze the first statement: 'Liabilities are recorded as revenue on the income statement.' This is incorrect because liabilities are recorded on the balance sheet, not the income statement, and they are not considered revenue.

Step 3: Analyze the second statement: 'Liabilities represent obligations that a company must settle in the future.' This is correct because liabilities are future obligations, such as loans, accounts payable, or accrued expenses.

Step 4: Analyze the third statement: 'Liabilities decrease when a company borrows money from a bank.' This is incorrect because borrowing money increases liabilities, as the company now owes the bank the borrowed amount.

Step 5: Analyze the fourth statement: 'Liabilities are resources owned by a company.' This is incorrect because liabilities are not owned; they represent amounts owed to others, whereas resources owned by a company are classified as assets.