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

Which type of accounting determines whether personal life insurance premiums are usually deductible?

Tax accounting

Financial accounting

Cost accounting

Managerial accounting

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Verified step by step guidance

Understand the context of the question: The problem is asking about the deductibility of personal life insurance premiums, which is a tax-related issue. This means the focus is on tax accounting rather than other types of accounting.

Clarify the role of tax accounting: Tax accounting deals with the preparation and filing of tax returns, compliance with tax laws, and determining the tax implications of various transactions, including deductions.

Differentiate between the accounting types: Financial accounting focuses on preparing financial statements for external users, cost accounting deals with cost analysis for production and operations, and managerial accounting supports internal decision-making. None of these directly address tax deductibility.

Relate the deductibility of personal life insurance premiums to tax laws: Tax accounting evaluates whether certain expenses, such as personal life insurance premiums, qualify as deductible under tax regulations. Generally, personal life insurance premiums are not deductible because they are considered personal expenses.

Conclude that tax accounting is the correct type of accounting to determine deductibility: Since tax accounting specifically addresses compliance with tax laws and deductions, it is the appropriate type of accounting for this question.