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 statements about supplies is accurate?

Supplies are recorded as revenue when acquired.

Supplies are expensed only when they are purchased, regardless of usage.

Supplies are classified as long-term liabilities on the balance sheet.

Supplies are considered current assets until they are used in operations.

Previous problemNext problem

Verified step by step guidance

Understand the nature of supplies: Supplies are items used in the daily operations of a business, such as office supplies or cleaning materials. They are not immediately expensed when purchased but are treated as assets until consumed.

Classify supplies on the balance sheet: Supplies are considered current assets because they are expected to be used within one year or the operating cycle, whichever is longer.

Recognize the accounting treatment: When supplies are purchased, they are recorded as an asset in the Supplies account. This reflects their future economic benefit to the business.

Expense supplies when used: As supplies are consumed in operations, their cost is transferred from the Supplies account to the Supplies Expense account. This aligns with the matching principle, which states that expenses should be recognized in the period they are incurred to generate revenue.

Evaluate the given statements: Based on the above understanding, the correct statement is: 'Supplies are considered current assets until they are used in operations.' The other statements are incorrect because supplies are not recorded as revenue, not expensed immediately upon purchase, and not classified as long-term liabilities.