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

Fundamental Accounting Equation

Financial Accounting

1. Introduction to Accounting

Fundamental Accounting Equation

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Multiple Choice

If equity equals $100 and liabilities equal $50, what is the value of assets according to the fundamental accounting equation?

$150

$50

$200

$100

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Verified step by step guidance

Understand the fundamental accounting equation: Assets = Liabilities + Equity. This equation represents the relationship between a company's resources (assets) and the claims against those resources (liabilities and equity).

Identify the values provided in the problem: Equity is $100, and Liabilities are $50.

Substitute the given values into the fundamental accounting equation. Using MathML, the equation can be expressed as:

Assets = Liabilities + Equity

Perform the addition operation to calculate the value of Assets. In MathML, this step can be expressed as:

50 + 100

Conclude that the value of Assets is the sum of Liabilities and Equity. This step ensures the equation balances, as required by the fundamental accounting principle.