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

Before purchasing an existing business, why is it important to determine whether the business's problems can be fixed?

To ensure the business has no competitors in the market

To avoid paying taxes on the business acquisition

To guarantee that the business will not require any future investment

To assess whether the business can become profitable under new ownership

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Verified step by step guidance

Understand the context: When purchasing an existing business, the buyer must evaluate the current state of the business, including its financial health, operational challenges, and market position.

Identify the purpose of the evaluation: The goal is to determine whether the business's problems are fixable and if the business can become profitable under new ownership. This involves assessing whether the issues are temporary or structural.

Analyze the financial statements: Review the income statement, balance sheet, and cash flow statement to identify areas of concern, such as declining revenues, high expenses, or poor cash flow management.

Evaluate operational challenges: Investigate operational inefficiencies, such as outdated processes, poor management, or lack of skilled employees, to determine if these can be improved with new strategies or investments.

Consider market and competitive factors: Assess the business's position in the market, including competition, customer base, and industry trends, to ensure that external factors do not pose insurmountable challenges to profitability.