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

The Financial Statements

Financial Accounting

1. Introduction to Accounting

The Financial Statements

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Multiple Choice

How is the balance sheet linked to the other financial statements?

The balance sheet is linked to the statement of cash flows only through liabilities.

The balance sheet is prepared independently and does not relate to the other financial statements.

The balance sheet only links to the income statement through total assets.

The ending cash balance on the balance sheet matches the cash balance on the statement of cash flows, and retained earnings on the balance sheet is affected by net income from the income statement.

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Verified step by step guidance

Understand the purpose of the balance sheet: The balance sheet provides a snapshot of a company's financial position at a specific point in time, showing assets, liabilities, and equity.

Recognize the connection to the income statement: Retained earnings on the balance sheet are directly affected by net income from the income statement. Net income is calculated as revenues minus expenses, and it flows into retained earnings as part of the equity section.

Identify the link to the statement of cash flows: The ending cash balance on the balance sheet matches the cash balance reported in the statement of cash flows. The statement of cash flows explains changes in cash during the period, which are reflected in the balance sheet.

Understand the integration of financial statements: The balance sheet, income statement, and statement of cash flows are interconnected. For example, changes in assets and liabilities on the balance sheet often result from transactions reported in the income statement and statement of cash flows.

Review the importance of consistency: Ensure that the ending balances on the balance sheet align with the corresponding figures in the income statement and statement of cash flows to maintain accuracy and consistency across all financial statements.