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

3. Accrual Accounting Concepts

Revenue Recognition and Expense Recognition

Financial Accounting

3. Accrual Accounting Concepts

Revenue Recognition and Expense Recognition

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Multiple Choice

Which of the following transactions does NOT affect cash during a period?

Collecting cash from customers for services rendered

Recording depreciation expense on equipment

Purchasing inventory with cash

Paying salaries to employees

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Verified step by step guidance

Step 1: Understand the nature of cash transactions. Cash transactions involve any activity where cash is either received or paid out during a period. Examples include collecting cash from customers, paying salaries, or purchasing inventory with cash.

Step 2: Analyze each transaction provided in the problem. Determine whether cash is involved in each case: (a) Collecting cash from customers for services rendered involves receiving cash, (b) Purchasing inventory with cash involves paying cash, (c) Paying salaries to employees involves paying cash.

Step 3: Focus on the transaction 'Recording depreciation expense on equipment.' Depreciation is a non-cash expense. It represents the allocation of the cost of an asset over its useful life and does not involve any cash inflow or outflow during the period.

Step 4: Compare the transactions. Identify the one that does not involve cash movement. In this case, recording depreciation expense does not affect cash, while the other transactions do.

Step 5: Conclude that the transaction 'Recording depreciation expense on equipment' does NOT affect cash during the period, as it is a non-cash accounting entry.