Ch 56: PLACE Business Education: Fundamentals of Accounting

About This Chapter

Brush up on your accounting knowledge with this chapter on accounting fundamentals. Use this chapter to prepare for basic accounting questions on the PLACE Business Education exam.

PLACE Business Education: Fundamentals of Accounting - Chapter Summary

This chapter covers foundational accounting topics that may appear on the PLACE Business Education. Use this chapter to review topics such as:

  • Ethics in accounting
  • Importance and purpose of accounting
  • Fundamental principles of accounting
  • Internal and external uses of accounting
  • Overview of GAAP
  • Accounting software and technology
  • Steps in the accounting cycle
  • Comparison of accounting and bookkeeping
  • Accrual and cash-based accounting
  • Source documents and closing entries

You'll be pleasantly surprised by how easy it is to study using the engaging videos found in this chapter. Each video is presented by an expert instructor, so you can feel confident you're getting the information you need to ace the PLACE Business Education test.

PLACE Business Education: Fundamentals of Accounting Chapter Objectives

The PLACE Business Education test is currently split into five subareas, one of which is Accounting, Finance and Business Law. The basics of accounting will be covered in this section, which may include questions on the topics in this chapter. All of the questions in the Accounting, Finance and Business Law subarea are multiple choice. The quizzes at the end of the chapter will show you the types of questions you can expect to find on the PLACE Business Education exam.

22 Lessons in Chapter 56: PLACE Business Education: Fundamentals of Accounting
Test your knowledge with a 30-question chapter practice test
The Importance of Ethics in Accounting

1. The Importance of Ethics in Accounting

Ethics - are they really important in accounting? In this lesson, we will discuss what ethics are and what role they play in accounting; we'll also review a case that is deeply rooted in ethics. In the end, we will decide whether or not ethics are important in accounting.

What Is Accounting? - Purpose, Importance & Relationship to Business

2. What Is Accounting? - Purpose, Importance & Relationship to Business

Just as French is considered the language of love, accounting is considered the language of business. In this lesson, you will learn exactly what accounting is. You will also learn the purpose of accounting, why it is important, and how it relates to the business world.

The Fundamental Principles of Accounting

3. The Fundamental Principles of Accounting

Accounting is an art, but just as with any form of art, you need the right tools to make your masterpiece. For accounting, those tools are the seven major accounting principles. In this lesson, you will learn what those principles are and what they are used for.

External and Internal Users and Uses of Accounting

4. External and Internal Users and Uses of Accounting

Accounting has many uses. In this lesson, you will learn not only who accounting users are but also what types of accounting information is used. You will also learn the uses of that accounting information.

Accounting Disciplines: Descriptions and Definitions

5. Accounting Disciplines: Descriptions and Definitions

Most people know that accountants work with numbers, but there's more to accounting than bookkeeping. In this lesson, you'll learn about various accounting disciplines including managerial, financial, tax, government and non-profit accounting.

What Is GAAP? - The Generally Accepted Accounting Principles

6. What Is GAAP? - The Generally Accepted Accounting Principles

Rules and regulations are a part of life for everyone, including those in the accounting industry. In this lesson, you will learn about GAAP standards, what they mean to accounting, and who establishes them.

Technology in Accounting: The Growing Role of Technology in Accounting

7. Technology in Accounting: The Growing Role of Technology in Accounting

Change and technology go hand in hand, especially in the accounting industry. In this lesson, we will take a walk back in time and discuss some of the technological advances in accounting through the years. We will also discuss how these changes have affected the accounting process.

The Accounting Cycle: Definition, Steps & Examples

8. The Accounting Cycle: Definition, Steps & Examples

Accounting is essential to the proper and efficient functioning of a business. In fact, it is often referred to as the 'language of business.' In this lesson, you'll learn about the steps in the accounting cycle. A short quiz follows.

Accounting vs Bookkeeping: Differences and Similarities

9. Accounting vs Bookkeeping: Differences and Similarities

The terms accounting and bookkeeping are common place in the business world. However, there's often confusion about the difference between these two terms. In this lesson, you'll learn the difference between accounting and bookkeeping.

The Differences Between Accrual & Cash-Basis Accounting

10. The Differences Between Accrual & Cash-Basis Accounting

There are two accounting methods that companies can choose from when deciding how they want their books done. They are cash basis and accrual basis. In this lesson, you will learn the differences between the two.

Internal Controls in Accounting: Definition, Types & Examples

11. Internal Controls in Accounting: Definition, Types & Examples

Rules and regulations are a part of everything we do. In this lesson, you will learn about internal controls in accounting. You will learn what they are, why they are important and see examples.

Source Documents in Accounting: Definition and Purpose

12. Source Documents in Accounting: Definition and Purpose

Do you know what role source documents play in accounting? If not, don't worry; by the end of this lesson, you will. You will also learn the definition of source documents and see some common examples of source documents.

Closing Entries: Process, Major Steps, Purpose & Objectives

13. Closing Entries: Process, Major Steps, Purpose & Objectives

The accounting cycle is a multi-step process. In this lesson, you will learn about part of that process: making closing entries. You will learn what closing entries are, what accounts are affected, and how they are made.

Computerized Accounting Software: Advantages & Disadvantages

14. Computerized Accounting Software: Advantages & Disadvantages

With business as complex as it is today, adopting computerized accounting software seems like the right choice. Even the most sophisticated computer programs have advantages and disadvantages. We will explore these in this lesson.

What Are Assets? - Definition & Examples

15. What Are Assets? - Definition & Examples

In this lesson, you will learn about assets, the first variable of the basic accounting equation. We will discuss the definition, categories, and classifications of assets.

Business Assets: Definition & Examples

16. Business Assets: Definition & Examples

Learn what business assets are, and find out some of the most common assets that companies have on their balance sheets in this lesson. Also, learn about some of the different ways that these assets are categorized.

What Are Fixed Assets? - Definition & Examples

17. What Are Fixed Assets? - Definition & Examples

A company may own different kinds of resources, among which are fixed assets. This lesson explains what fixed assets are, provides examples, and notes the importance of a business' industry in determining fixed assets.

Total Assets: Definition & Explanation

18. Total Assets: Definition & Explanation

Assets come in many different categories and classifications. In this lesson, we will take a look at total assets. You will learn not only what total assets are but also where a company must report them.

What Are Current Assets? - Definition, Examples & Calculation

19. What Are Current Assets? - Definition, Examples & Calculation

In this lesson, you will learn the meaning of the term current asset. You will also learn what items fall into the category of current assets and how they fit on a balance sheet.

Non-Current Assets: Definition & Examples

20. Non-Current Assets: Definition & Examples

The accounting industry is centered on a basic equation: Assets = Liabilities + Owner's Equity. To fully understand this, you must first understand each component of the equation. In this lesson, we will discuss one category that falls under the classification of an asset: non-current assets.

How to Calculate Asset Turnover Ratio: Formula & Example

21. How to Calculate Asset Turnover Ratio: Formula & Example

The asset turnover ratio is one of the items that companies and potential stockholders look at in order to figure out how well a company's money is working for it. In this lesson, we will learn how to calculate a company's asset turnover ratio.

Capital Asset Pricing Model (CAPM): Definition, Formula, Advantages & Example

22. Capital Asset Pricing Model (CAPM): Definition, Formula, Advantages & Example

Learn about the Capital Asset Pricing Model (CAPM), one of the foundational models in finance. We'll look at the underlying assumptions, how the model is calculated, and what it can do for you.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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