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 one of the following types of accounting would most likely result in the establishment of a contract between two parties?

Financial accounting

Managerial accounting

Tax accounting

Auditing (attestation services)

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Verified step by step guidance

Understand the concept of auditing: Auditing involves the examination of financial statements and records to ensure accuracy and compliance with established standards. It often results in an attestation service, where an auditor provides an independent opinion on the reliability of financial information.

Recognize the role of contracts in auditing: Auditing typically requires a formal agreement or contract between the auditor and the client. This contract outlines the scope of the audit, responsibilities, and deliverables, ensuring both parties are clear on expectations.

Differentiate auditing from other types of accounting: Financial accounting focuses on preparing financial statements, managerial accounting aids internal decision-making, and tax accounting deals with compliance and tax planning. Auditing, however, involves verifying the accuracy of financial information and providing assurance services.

Understand why auditing leads to contracts: Since auditing involves an independent third party providing assurance, a contract is necessary to establish the terms of the engagement, including confidentiality, scope, and fees.

Conclude that auditing (attestation services) is the type of accounting most likely to result in the establishment of a contract between two parties, as it formalizes the relationship and expectations between the auditor and the client.