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

Fundamental Accounting Equation

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Multiple Choice

Providing services to customers for cash would have what effect on the fundamental accounting equation?

Increase liabilities and decrease equity

Increase assets and increase equity

Increase assets and decrease liabilities

Decrease assets and increase liabilities

Verified step by step guidance

Understand the fundamental accounting equation: Assets = Liabilities + Equity. This equation must always remain balanced.

Recognize that providing services to customers for cash means the business is earning revenue and receiving cash, which is an asset.

Revenue earned increases equity because it contributes to the company's retained earnings, a component of equity.

Receiving cash increases assets, specifically the cash account, as the business now has more money.

Conclude that the transaction increases both assets (cash) and equity (retained earnings), while liabilities remain unchanged.

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