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 type of accounting refers to a company's ability to meet long-term obligations and generate future revenues?

Tax accounting

Cost accounting

Solvency accounting

Managerial accounting

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Verified step by step guidance

Understand the concept of solvency accounting: Solvency accounting focuses on evaluating a company's ability to meet its long-term financial obligations and sustain operations by generating future revenues.

Differentiate solvency accounting from other types of accounting: Tax accounting deals with compliance with tax laws, cost accounting focuses on analyzing costs for decision-making, and managerial accounting provides information for internal management decisions.

Recognize the importance of solvency accounting: It helps stakeholders assess the financial health of a company, ensuring it can continue operations and fulfill obligations over the long term.

Identify key metrics used in solvency accounting: Common metrics include the debt-to-equity ratio, interest coverage ratio, and long-term debt ratio, which provide insights into a company's financial stability.

Apply solvency accounting in practice: Use financial statements, such as the balance sheet and income statement, to calculate solvency ratios and evaluate the company's ability to generate future revenues and meet obligations.