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

Which of the following elements is NOT part of the fundamental accounting equation?

Revenues

Equity

Assets

Liabilities

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Verified step by step guidance

Step 1: Begin by recalling the fundamental accounting equation, which is expressed as:

Assets = Liabilities + Equity

. This equation forms the foundation of financial accounting and represents the relationship between a company's resources and claims against those resources.

Step 2: Analyze each option provided in the question to determine whether it is part of the fundamental accounting equation. The options are: Revenues, Equity, Assets, and Liabilities.

Step 3: Recognize that 'Assets,' 'Liabilities,' and 'Equity' are explicitly part of the fundamental accounting equation, as they represent the components of a company's financial position.

Step 4: Understand that 'Revenues' are not part of the fundamental accounting equation itself. Revenues are part of the income statement and contribute to changes in equity through retained earnings, but they are not directly included in the equation.

Step 5: Conclude that the element 'Revenues' is NOT part of the fundamental accounting equation, as it pertains to the performance of the company rather than its financial position.