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 best describes what the custodian of a company asset should do?

Have physical control of the asset but not maintain the accounting records for it.

Only maintain the accounting records for the asset, not physical control.

Maintain both physical control and the accounting records for the asset.

Authorize all transactions related to the asset.

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Verified step by step guidance

Understand the concept of segregation of duties: In financial accounting, segregation of duties is a key internal control principle. It ensures that no single individual has control over all aspects of a financial transaction or asset, reducing the risk of fraud or errors.

Identify the role of the custodian: The custodian is responsible for the physical control of the asset, meaning they safeguard and manage the asset to ensure it is not lost, stolen, or misused.

Clarify the role of accounting records: Maintaining accounting records involves documenting transactions and financial information related to the asset. This task should be performed by a separate individual or department to ensure proper checks and balances.

Evaluate the options provided: Analyze each option to determine which aligns with the principle of segregation of duties. The correct option should separate physical control of the asset from the maintenance of accounting records.

Conclude that the custodian should have physical control of the asset but not maintain the accounting records for it, as this ensures proper internal controls and reduces the risk of fraud or errors.