Multiple Choice
Most credit cards will charge you an annual fee. Which type of accounting would typically record and report such fees for a business?
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1. Introduction to Accounting
Types of Accounting
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Which of the following is an example of a type of accounting?
A
Actuarial accounting
B
Financial accounting
C
Nonforfeiture accounting
D
Insurance accounting
Verified step by step guidance1
Understand the question: The problem is asking to identify a type of accounting from the given options.
Review the options provided: Actuarial accounting, Financial accounting, Nonforfeiture accounting, and Insurance accounting.
Clarify the concept of Financial Accounting: Financial accounting is a branch of accounting focused on recording, summarizing, and reporting financial transactions to external users such as investors, creditors, and regulatory agencies.
Compare the options: Actuarial accounting and Insurance accounting are specialized fields related to insurance and risk management, while Nonforfeiture accounting is not a recognized type of accounting. Financial accounting is the correct and widely recognized type of accounting.
Conclude the reasoning: Based on the definitions and comparisons, Financial accounting is the correct answer as it is a standard type of accounting used in practice.
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