1. List the components that comprise a typical financial statement.
a. Income Statement
i. Reflects Net Income and Net Loss
ii. Is a moving picture of operations during the period
b. Statement of Owners Equity
iii. Changes in owners equity during a time period
iv. Increases from Net Income
v. Decreases from Withdrawals and Net Loss
c. Balance Sheet
vi. “Statement of financial position”
vii. Lists all Assets, liabilities, and owns
viii. As of a specific date +
d. Statement of cash flows
ix. Cash receipts and cash payments
2. Describe how ...view middle of the document...
5. How can you determine the contribution margin from an Income Statement?
6. How is a horizontal and vertical analysis calculated?
7. Describe how horizontal analysis and vertical analysis of a Balance Sheet are used to evaluate a firm’s performance over a period of time.
8. What two methods can be used to prepare a Statement of Cash Flows?
9. What three categories are shown on the Statement of Cash Flows? What accounts are shown under each category?
1. What is the difference between liquidity ratios and solvency ratios and what is their relationship to a firm’s profitability?
2. What is the difference between profitability ratios and market prospect ratios?
3. Which ratios are liquidity, solvency, profitability, and market prospect? How are they calculated?
4. How does the interpretation of financial data differ depending upon the perspective of the person analyzing the data?
1. What is the difference between direct and indirect costs?
2. What is the difference between sunk costs, opportunity costs, and differential costs?
3. What is a cost variance analysis?
4. Describe the difference between activity-based costing and traditional allocation methods. When should you use activity based costing?
5. Define a job order costing system and a process costing system.
6. In what type of activity would you use job order costing? Process costing?
7. How is the contribution margin calculated?
8. What is Cost-Volume-Profit Analysis (CVP)?
9. How is the breakeven point in units calculated?
10. How is the breakeven point in sales dollars calculated?
11. What is a variable cost? What is a fixed cost?
1. What are the four types of bonds and what are their characteristics?
2. What is the price of a bond issued at par value, a discount, a premium?
3. What impact does the market rate of interest have on the price of a bond?
4. How do you calculate the interest expense for bonds issued at a discount or premium using the straight-line method?
5. How do you calculate the interest expense for bonds issued at a discount or premium using the effective interest method?
6. Compare and contrast issuing common stock, preferred stock, and bonds as a...