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

Business Organization

Financial Accounting

1. Introduction to Accounting

Business Organization

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Multiple Choice

Which of the following is a primary advantage of forming a corporation?

Simplified tax reporting compared to sole proprietorships

Unlimited personal liability for owners

Direct management by all shareholders

Limited liability for shareholders

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Understand the concept of a corporation: A corporation is a legal entity that is separate from its owners (shareholders). It has its own rights and responsibilities, and its structure provides certain advantages and disadvantages compared to other business forms like sole proprietorships or partnerships.

Review the concept of limited liability: Limited liability means that shareholders are not personally responsible for the debts and obligations of the corporation. Their financial risk is limited to the amount they have invested in the corporation.

Compare the advantages of a corporation to other business structures: Unlike sole proprietorships or partnerships, where owners may have unlimited personal liability, corporations protect shareholders from being personally liable for the company's debts.

Evaluate the incorrect options: Simplified tax reporting is not a primary advantage of corporations, as corporations often face more complex tax requirements. Unlimited personal liability is incorrect because corporations offer limited liability. Direct management by all shareholders is not typical in corporations, as management is usually handled by a board of directors and executives.

Conclude that the primary advantage of forming a corporation is limited liability for shareholders, which protects their personal assets from the corporation's financial risks.