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

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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

Which of the following is NOT included as part of the cost of equipment?

Purchase price of the equipment

Installation costs

Freight charges to deliver the equipment

Annual maintenance expenses

Previous problemNext problem

Verified step by step guidance

Understand the concept of equipment cost: The cost of equipment includes all expenditures necessary to acquire the asset and prepare it for use. This typically includes the purchase price, installation costs, and freight charges.

Review the components of equipment cost: The purchase price is the primary cost of acquiring the equipment. Installation costs are necessary to make the equipment operational, and freight charges are incurred to transport the equipment to its location.

Identify costs that are excluded: Costs that are not directly related to acquiring or preparing the equipment for use, such as annual maintenance expenses, are considered operating expenses and are not included in the equipment's initial cost.

Differentiate between capital expenditures and operating expenses: Capital expenditures are costs that provide future economic benefits and are included in the asset's cost. Operating expenses, like annual maintenance, are recurring costs that are expensed in the period they are incurred.

Conclude the analysis: Based on the definitions and distinctions, annual maintenance expenses are not part of the equipment's cost because they are ongoing operating expenses rather than initial acquisition or preparation costs.