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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

Useful Information

Financial Accounting

1. Introduction to Accounting

Useful Information

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Multiple Choice

Why does paying off the highest interest rate credit card first make the most mathematical sense?

Because it increases your credit score more quickly than paying off lower interest cards first.

Because it allows you to close credit card accounts faster.

Because it reduces your minimum monthly payments immediately.

Because it minimizes the total interest paid over time, reducing the overall cost of debt.

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Verified step by step guidance

Understand the concept of interest rates: Higher interest rates mean that the cost of borrowing is greater, and the debt grows faster over time if not paid off.

Recognize the mathematical impact: Paying off the highest interest rate credit card first minimizes the accumulation of interest, reducing the total cost of debt over time.

Compare the alternatives: Paying off lower interest rate cards first would allow interest on higher rate cards to continue compounding, leading to a higher overall debt burden.

Consider the long-term financial benefit: By focusing on the highest interest rate card, you reduce the principal balance that accrues the most expensive interest, saving money in the long run.

Apply this strategy consistently: After paying off the highest interest rate card, move to the next highest rate card, continuing the process to minimize total interest paid.