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 NOT a reason a business needs credit, as stated in the presentation?

To increase owner's personal wealth

To finance expansion

To purchase inventory

To manage cash flow gaps

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Verified step by step guidance

Step 1: Understand the concept of business credit. Business credit refers to the ability of a company to borrow money or access financial resources to support its operations, growth, and other financial needs.

Step 2: Review the reasons businesses typically need credit. Common reasons include financing expansion, purchasing inventory, and managing cash flow gaps. These are essential for maintaining and growing the business.

Step 3: Analyze the option 'To increase owner's personal wealth.' This is not a legitimate reason for a business to need credit, as business credit is intended to support the operations and growth of the business, not to benefit the owner's personal finances.

Step 4: Compare the options provided in the question. Identify which reasons align with legitimate business needs and which do not.

Step 5: Conclude that the correct answer is 'To increase owner's personal wealth,' as it does not align with the purpose of business credit, which is focused on operational and financial needs of the business.