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

Previous problemNext problem

Struggling with Financial Accounting?

Join thousands of students who trust us to help them ace their exams!Watch the first video

Multiple Choice

When buying an existing business, it is important to:

Review the financial statements and verify their accuracy.

Assume all assets are in perfect condition without inspection.

Ignore any outstanding liabilities.

Rely solely on the seller's verbal assurances.

Previous problemNext problem

Verified step by step guidance

Understand the importance of reviewing financial statements: Financial statements provide a detailed overview of the business's financial health, including assets, liabilities, equity, revenues, and expenses. This step ensures you have accurate and reliable data to assess the business's value.

Verify the accuracy of financial statements: Conduct a thorough audit or hire a professional accountant to confirm the accuracy of the financial statements. This may involve cross-checking records, reconciling accounts, and ensuring compliance with accounting standards.

Inspect the condition of assets: Even if the seller claims all assets are in perfect condition, it is essential to physically inspect them or hire an expert to evaluate their actual state. This helps avoid overestimating the value of the business.

Identify and assess outstanding liabilities: Review the balance sheet and other financial records to identify any liabilities, such as loans, accounts payable, or legal obligations. Understanding these liabilities is crucial for determining the net worth of the business.

Avoid relying solely on verbal assurances: Always seek documented evidence and perform due diligence rather than relying on the seller's verbal claims. This ensures you make an informed decision based on verified information.