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

Why do companies issue stock?

To raise capital for business operations and growth

To increase the company's expenses

To reduce their total liabilities

To decrease the number of shareholders

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Verified step by step guidance

Understand the concept of issuing stock: Companies issue stock to raise capital by selling ownership shares to investors. This capital can be used for various purposes, such as funding business operations, expanding the company, or investing in new projects.

Analyze the options provided: Evaluate each option to determine which aligns with the primary purpose of issuing stock. For example, raising capital is a direct benefit, while increasing expenses or reducing liabilities are not typically associated with issuing stock.

Consider the impact on shareholders: Issuing stock increases the number of shareholders, as new investors purchase shares. This is contrary to the option suggesting a decrease in shareholders.

Focus on the correct purpose: The primary reason companies issue stock is to raise capital for business operations and growth. This aligns with the correct answer provided in the problem.

Conclude by eliminating incorrect options: Exclude options that do not align with the purpose of issuing stock, such as increasing expenses, reducing liabilities, or decreasing shareholders, and confirm the correct answer.