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

Frank is shopping for a disability income policy. Which of the following features would most likely reduce the premium he pays for the policy?

Choosing a longer elimination (waiting) period before benefits begin

Adding a cost-of-living adjustment (COLA) rider

Opting for a shorter benefit period

Selecting a higher monthly benefit amount

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Verified step by step guidance

Understand the concept of a disability income policy: This type of insurance provides income replacement if the policyholder becomes unable to work due to a disability. Premiums are influenced by various factors, including elimination periods, benefit periods, and additional riders.

Analyze the elimination (waiting) period: A longer elimination period means the policyholder waits longer before receiving benefits, which reduces the insurer's risk and typically lowers the premium.

Evaluate the cost-of-living adjustment (COLA) rider: Adding a COLA rider increases the premium because it adjusts benefits for inflation, ensuring the policyholder's purchasing power remains stable over time.

Consider the benefit period: Opting for a shorter benefit period reduces the insurer's liability, which can lower the premium. However, this also limits the duration of income replacement for the policyholder.

Assess the monthly benefit amount: Selecting a higher monthly benefit increases the premium because the insurer is committing to pay more in the event of a claim. Lowering the benefit amount would reduce the premium.