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

4. Merchandising Operations

Net Sales

Financial Accounting

4. Merchandising Operations

Net Sales

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Multiple Choice

If someone buys a home for $200,000 and makes a 20 percent down payment, that person will have to:

Pay $40,000 upfront and finance the remaining $160,000

Pay the full $200,000 upfront

Pay $20,000 upfront and finance the remaining $180,000

Pay $160,000 upfront and finance the remaining $40,000

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Verified step by step guidance

Step 1: Understand the concept of a down payment. A down payment is an upfront payment made when purchasing an asset, typically expressed as a percentage of the total purchase price. The remaining amount is financed through a loan or other means.

Step 2: Calculate the down payment amount. Multiply the purchase price of the home ($200,000) by the down payment percentage (20%). Use the formula: Down Payment = Purchase Price × Down Payment Percentage. In MathML:

Down Payment = Purchase Price \times Down Payment Percentage

Step 3: Determine the financed amount. Subtract the down payment amount from the total purchase price. Use the formula: Financed Amount = Purchase Price - Down Payment. In MathML:

Financed Amount = Purchase Price - Down Payment

Step 4: Compare the calculated values to the options provided in the problem. Match the calculated down payment and financed amount to the correct answer choice.

Step 5: Verify the logic of the answer. Ensure that the down payment and financed amount align with the percentages and total purchase price given in the problem.