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 are the types of expenditures that can occur subsequent to an asset's acquisition?

Operating expenditures and financing expenditures

Capital expenditures and revenue expenditures

Fixed expenditures and variable expenditures

Direct expenditures and indirect expenditures

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Verified step by step guidance

Understand the context of the question: The problem is asking about the types of expenditures that occur after an asset is acquired. This relates to how costs are classified in financial accounting.

Recall the definitions: Capital expenditures are costs incurred to improve or extend the life of an asset, and they are capitalized (added to the asset's value on the balance sheet). Revenue expenditures are costs incurred for the day-to-day maintenance or operation of an asset, and they are expensed in the income statement.

Eliminate incorrect options: Operating expenditures and financing expenditures are not classifications used for post-acquisition costs of assets. Fixed and variable expenditures refer to cost behavior, not asset-related expenditures. Direct and indirect expenditures are classifications based on cost allocation, not asset-related expenditures.

Identify the correct answer: The correct classifications for expenditures after an asset's acquisition are capital expenditures and revenue expenditures, as these are the standard terms used in financial accounting.

Apply this knowledge: When analyzing expenditures related to an asset, determine whether the cost improves the asset or maintains its current condition to classify it as either a capital or revenue expenditure.