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

K buys a policy where the premium payments are recorded as an expense in the company's financial statements. Which type of accounting is primarily responsible for recording this transaction?

Cost accounting

Tax accounting

Managerial accounting

Financial accounting

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Verified step by step guidance

Understand the nature of the transaction: The premium payments for the policy are recorded as an expense in the company's financial statements. This indicates that the transaction is related to external reporting and compliance with accounting standards.

Review the definitions of the accounting types provided: Cost accounting focuses on analyzing costs for internal decision-making, tax accounting deals with tax compliance and planning, managerial accounting supports internal management decisions, and financial accounting is concerned with preparing financial statements for external stakeholders.

Identify the primary purpose of financial accounting: Financial accounting is responsible for recording transactions and preparing financial statements that reflect the company's financial position and performance for external users, such as investors, creditors, and regulatory bodies.

Match the transaction to the correct accounting type: Since the premium payments are recorded as an expense in the financial statements, this falls under the scope of financial accounting, which ensures accurate reporting in accordance with accounting standards.

Conclude that financial accounting is the correct answer because it is primarily responsible for recording transactions that appear in the company's financial statements and are used for external reporting purposes.