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

Useful Information

Financial Accounting

1. Introduction to Accounting

Useful Information

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Multiple Choice

Which of the following items could Chinwe possibly deduct as a business expense for her sole proprietorship?

Office supplies used exclusively for business operations

Personal groceries for home consumption

Private home mortgage payments

Family vacation expenses

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Verified step by step guidance

Understand the concept of business expenses: Business expenses are costs incurred in the ordinary course of business operations. To qualify as deductible, the expense must be both ordinary (common and accepted in the industry) and necessary (helpful and appropriate for the business). Personal expenses are not deductible.

Analyze each item provided in the problem: Determine whether each expense meets the criteria of being ordinary and necessary for Chinwe's sole proprietorship.

Evaluate 'Office supplies used exclusively for business operations': These are directly related to the business and are used exclusively for its operations, making them deductible as a business expense.

Evaluate 'Personal groceries for home consumption': These are personal expenses and not related to the business operations, so they are not deductible.

Evaluate 'Private home mortgage payments' and 'Family vacation expenses': Both are personal expenses and do not meet the criteria of being ordinary and necessary for the business, so they are not deductible.