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

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Multiple Choice

Indirect and service department expenses are allocated across departments that _____ them.

incur

benefit from

manage

audit

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Verified step by step guidance

Understand the context of the question: The problem is about how indirect and service department expenses are allocated in an organization. These expenses are typically shared costs that need to be distributed among departments.

Recognize the key terms: 'Indirect expenses' are costs that cannot be directly traced to a specific department, and 'service department expenses' are costs incurred by departments that provide support services to other departments.

Focus on the allocation principle: Indirect and service department expenses are allocated based on the principle of benefiting departments. This means the costs are distributed to the departments that receive the services or benefits from the service department.

Eliminate incorrect options: 'Incur' refers to the department that generates the expense, which is not relevant here. 'Manage' and 'audit' are also unrelated to the allocation principle. The correct answer is 'benefit from,' as it aligns with the principle of cost allocation.

Conclude with the correct understanding: Indirect and service department expenses are allocated to the departments that benefit from the services provided, ensuring a fair distribution of shared costs.