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

If both parties agree to share the risk in a business arrangement, which type of accounting contract is most appropriate to use?

Employment contract

Fixed-fee contract

Partnership agreement

Lease agreement

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Verified step by step guidance

Understand the concept of risk-sharing in a business arrangement. Risk-sharing typically involves both parties agreeing to jointly bear the financial risks and rewards of the business venture.

Review the types of accounting contracts provided in the problem: Employment contract, Fixed-fee contract, Partnership agreement, and Lease agreement.

Analyze each option: Employment contracts are typically used for hiring employees and do not involve risk-sharing. Fixed-fee contracts involve a set payment for services and do not account for shared risks. Lease agreements pertain to renting assets and do not involve risk-sharing in business operations.

Focus on the Partnership agreement: This type of contract is specifically designed for situations where two or more parties agree to share the risks, profits, and losses of a business venture.

Conclude that the Partnership agreement is the most appropriate type of accounting contract for risk-sharing in a business arrangement, as it aligns with the concept of joint financial responsibility.