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

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Multiple Choice

Which of the following is NOT a reason for listing assumptions in a cost estimate?

To identify potential risks and uncertainties

To facilitate future revisions and updates to the estimate

To clarify the basis on which the estimate is prepared

To ensure that all costs are understated for competitive advantage

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Verified step by step guidance

Understand the purpose of listing assumptions in a cost estimate. Assumptions are included to provide clarity and transparency about the basis of the estimate, helping stakeholders understand the context and limitations.

Review the options provided in the question. Each option represents a potential reason for listing assumptions in a cost estimate. Analyze each option carefully to determine its validity.

Option 1: 'To identify potential risks and uncertainties' - This is a valid reason because assumptions help highlight areas where risks or uncertainties may exist, allowing for better risk management.

Option 2: 'To facilitate future revisions and updates to the estimate' - This is also valid because assumptions provide a framework that can be revisited and adjusted as new information becomes available.

Option 3: 'To ensure that all costs are understated for competitive advantage' - This is NOT a valid reason. Understating costs intentionally is unethical and does not align with the purpose of listing assumptions, which is to ensure transparency and accuracy in the estimate.