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 statements is true about a savings account?

A savings account is classified as an expense account in financial accounting.

A savings account typically earns interest on the deposited balance.

A savings account is primarily used for daily business transactions.

A savings account allows unlimited withdrawals without any restrictions.

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Verified step by step guidance

Understand the nature of a savings account: A savings account is a type of bank account designed to hold money securely while earning interest on the deposited balance. It is not classified as an expense account in financial accounting.

Clarify the purpose of a savings account: Savings accounts are primarily used for saving money rather than daily business transactions. Daily transactions are typically conducted through checking accounts.

Explain the withdrawal restrictions: Savings accounts often have limitations on the number of withdrawals or transactions allowed per month, as per banking regulations. They do not allow unlimited withdrawals without restrictions.

Highlight the interest-earning feature: Savings accounts typically earn interest on the deposited balance, which is one of their key features and benefits.

Conclude by identifying the correct statement: Based on the explanations above, the correct statement is that a savings account typically earns interest on the deposited balance.