Multiple Choice
Which type of accounting primarily focuses on the duties and obligations of businesses that contribute to the well-being of society?
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1. Introduction to Accounting
Types of Accounting
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Which type of accounting allows a policyowner to choose the frequency of premium payments for an insurance policy?
A
Managerial Accounting
B
Financial Accounting
C
Tax Accounting
D
Insurance Accounting
Verified step by step guidance1
Understand the context of the question: The problem is asking about the type of accounting related to the frequency of premium payments for an insurance policy. This is specific to the insurance industry.
Recognize that the frequency of premium payments is a decision made by the policyowner and is directly tied to the operations and financial management of insurance policies.
Identify that Insurance Accounting is a specialized branch of accounting that deals with the financial transactions and reporting specific to insurance companies, including premium payments, claims, and reserves.
Differentiate Insurance Accounting from other types of accounting mentioned: Managerial Accounting focuses on internal decision-making, Financial Accounting deals with external reporting, and Tax Accounting focuses on compliance with tax laws.
Conclude that Insurance Accounting is the correct type of accounting because it specifically addresses the financial aspects of insurance policies, including premium payment frequency.
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