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 is a disadvantage of S corporations?

S corporations are taxed twice on their income, once at the corporate level and again at the shareholder level.

S corporations can issue multiple classes of stock to attract investors.

S corporations are subject to strict eligibility requirements, such as limits on the number and type of shareholders.

S corporations have unlimited liability for their shareholders.

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Verified step by step guidance

Understand the concept of S corporations: S corporations are a type of corporation that allows income, losses, deductions, and credits to pass through to shareholders for federal tax purposes, avoiding double taxation.

Review the advantages of S corporations: They are not taxed at the corporate level, and shareholders report income on their personal tax returns, avoiding double taxation. Additionally, S corporations have limited liability for shareholders.

Analyze the disadvantages of S corporations: They are subject to strict eligibility requirements, such as limits on the number of shareholders (typically 100 or fewer) and restrictions on the types of shareholders (e.g., individuals, certain trusts, and estates).

Evaluate the incorrect options: S corporations are not taxed twice (avoiding double taxation is a key advantage), and they cannot issue multiple classes of stock; they are limited to one class of stock.

Conclude that the correct disadvantage is: S corporations are subject to strict eligibility requirements, such as limits on the number and type of shareholders.