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

2. Transaction Analysis

Journal Entries: Debits and Credits

Financial Accounting

2. Transaction Analysis

Journal Entries: Debits and Credits

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Multiple Choice

Reviewing and evaluating records used to prepare a company's financial statements is referred to as:

Journalizing

Reconciling

Posting

Auditing

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Verified step by step guidance

Understand the concept of auditing: Auditing refers to the process of reviewing and evaluating the records, transactions, and procedures used to prepare a company's financial statements to ensure accuracy, compliance, and reliability.

Differentiate between the terms provided: Journalizing involves recording transactions in the journal, reconciling refers to matching records to ensure consistency (e.g., bank reconciliation), and posting involves transferring journal entries to the ledger accounts.

Recognize that auditing is distinct from these processes: Auditing is a higher-level activity that focuses on verifying the integrity of financial statements rather than recording or transferring transactions.

Consider the role of an auditor: Auditors examine financial records, internal controls, and compliance with accounting standards to provide assurance that the financial statements are free from material misstatement.

Conclude that the correct term for reviewing and evaluating records used to prepare financial statements is auditing, as it encompasses the verification and validation of financial information.