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

Useful Information

Financial Accounting

1. Introduction to Accounting

Useful Information

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

Which of the following best explains why two employees at a company, earning the same gross pay, might have different net pays?

One employee works part-time and the other full-time.

They are paid in different currencies.

Their gross pay includes overtime for one employee only.

They have different amounts withheld for taxes and benefits.

Previous problemNext problem

Verified step by step guidance

Understand the concept of gross pay and net pay: Gross pay is the total earnings before any deductions, while net pay is the amount an employee takes home after deductions such as taxes, benefits, and other withholdings.

Identify the factors that can affect net pay: These include tax rates, benefit contributions (e.g., health insurance, retirement plans), and other deductions specific to each employee.

Analyze the scenario: Even if two employees have the same gross pay, their net pay can differ due to variations in tax withholding rates (e.g., based on filing status or exemptions claimed) and benefit contributions (e.g., one employee may opt for higher health insurance coverage).

Eliminate irrelevant options: Working part-time vs. full-time, being paid in different currencies, or earning overtime does not directly explain differences in net pay if gross pay is the same.

Conclude that the correct explanation is: Differences in amounts withheld for taxes and benefits lead to variations in net pay for employees earning the same gross pay.