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 accounts does NOT appear on the balance sheet?

Prepaid Insurance

Utility Expense

Accounts Receivable

Accumulated Depreciation

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Verified step by step guidance

Step 1: Understand the purpose of the balance sheet. The balance sheet is a financial statement that reports a company's assets, liabilities, and equity at a specific point in time. It includes accounts that represent resources owned by the company (assets), obligations owed (liabilities), and the owner's claims on the company (equity).

Step 2: Review the nature of each account listed in the problem. Prepaid Insurance is an asset account because it represents a payment made in advance for insurance coverage that will benefit future periods. Accounts Receivable is also an asset account, representing amounts owed to the company by customers for goods or services provided. Accumulated Depreciation is a contra-asset account that reduces the value of fixed assets on the balance sheet.

Step 3: Identify the account that does NOT belong on the balance sheet. Utility Expense is an expense account, which is reported on the income statement rather than the balance sheet. Expenses represent costs incurred during a period to generate revenue and are not considered assets, liabilities, or equity.

Step 4: Confirm the classification of Utility Expense. Expenses are temporary accounts that are closed to retained earnings at the end of the accounting period and do not appear on the balance sheet. This distinguishes them from the other accounts listed, which are permanent accounts appearing on the balance sheet.

Step 5: Conclude that Utility Expense does not appear on the balance sheet, while Prepaid Insurance, Accounts Receivable, and Accumulated Depreciation do appear on the balance sheet as asset-related accounts.