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

3. Accrual Accounting Concepts

Revenue Recognition and Expense Recognition

Financial Accounting

3. Accrual Accounting Concepts

Revenue Recognition and Expense Recognition

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Multiple Choice

Which two terms are commonly used to describe specific promises a company makes about the performance of its product?

Assets and Liabilities

Revenues and Expenses

Warranties and Guarantees

Accruals and Deferrals

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Verified step by step guidance

Understand the context of the question: The problem is asking about terms that describe promises a company makes regarding the performance of its product. These promises are typically obligations or assurances provided to customers.

Recognize that the terms 'Assets and Liabilities' refer to the financial position of a company, not promises about product performance. Assets are resources owned by the company, and liabilities are obligations owed to others.

Identify that 'Revenues and Expenses' relate to the income and costs incurred by a company during its operations, which are not directly tied to product performance promises.

Clarify that 'Accruals and Deferrals' are accounting methods used to record revenues and expenses in the correct period, and they do not describe product performance promises.

Conclude that 'Warranties and Guarantees' are the correct terms because they specifically refer to commitments a company makes to ensure the quality or performance of its product, often providing remedies if the product fails to meet expectations.