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

4. Merchandising Operations

Single-step Income Statement

Financial Accounting

4. Merchandising Operations

Single-step Income Statement

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Multiple Choice

On which of the following financial statements does net income appear?

Income Statement

Statement of Retained Earnings

Balance Sheet

Statement of Cash Flows

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Understand the concept of net income: Net income is the profit or loss of a company after all revenues and expenses have been accounted for during a specific period.

Identify the financial statements: The four primary financial statements are the Income Statement, Statement of Retained Earnings, Balance Sheet, and Statement of Cash Flows.

Determine where net income is reported: Net income is first calculated and reported on the Income Statement, as it represents the company's profitability for the period.

Trace the flow of net income: Net income is then carried over to the Statement of Retained Earnings, where it is used to calculate the ending retained earnings after accounting for dividends.

Understand its indirect impact on other statements: While net income does not directly appear on the Balance Sheet or Statement of Cash Flows, it influences these statements. For example, net income affects retained earnings on the Balance Sheet and is a component of operating activities in the Statement of Cash Flows.