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 of the following statements about assets is true?

Assets are resources owned by a company that are expected to provide future economic benefits.

Assets decrease owner's equity when acquired.

Assets are only recorded when cash is received.

Assets are obligations that a company must settle in the future.

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Verified step by step guidance

Understand the definition of assets: Assets are resources owned by a company that are expected to provide future economic benefits. They are not obligations or liabilities, which represent amounts owed by the company.

Clarify the relationship between assets and owner's equity: When assets are acquired, they do not directly decrease owner's equity. Instead, the acquisition of assets may involve an exchange of cash or other resources, or an increase in liabilities if financed through debt.

Examine the recording of assets: Assets are recorded when they meet the criteria of being measurable and providing future economic benefits, not solely when cash is received. For example, accounts receivable are recorded as assets even though cash has not yet been received.

Differentiate assets from liabilities: Liabilities are obligations that a company must settle in the future, such as loans or accounts payable. Assets, on the other hand, represent resources owned by the company.

Identify the correct statement: Based on the definitions and clarifications above, the correct statement is that assets are resources owned by a company that are expected to provide future economic benefits.