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Puppy Essay

353 words - 2 pages

STUDY GUIDE EXAM 1: (25 multiple choice questions worth 3 points each and 3 problems worth 45 points)
3 problems may cover following topics: journal entries, adjusting journal entries, closing entries, preparation of financial statements, multiple step income statement.
Chapter 1:
Purpose (objective) of financial accounting; cash vs accrual accounting (net operating cash flow vs. net income); history of standard setting – SEC, AICPA (formerly AIA), CAP, APB, FASB; process of standard setting (graphic 1-4); global accounting standards – IASC, IASB, IFRS, Covergence project; Sarbanes-Oxley Act 2002 – Key provisions; Conceptual framework – objective of ...view middle of the document...

Chapter 3:
Balance Sheet – uses and limitations; Classification – Asset (current vs. non current), Liab. (current vs. noncurrent), Stockholders’ equity, should know how to prepare a classified balance sheet; Disclosure notes; managements’ responsibility – responsibility for fairness of financial statements and responsibility for reporting on internal controls; auditor’s report - report and opinion on fairness of financial statements (Graphic 3-14 on page 130), report on assessment of internal controls; risk analysis – liquidity ratios (working capital, current ratio, acid-test or quick ratio), solvency (financing) ratios (debt to equity ratio, long-term debt to equity ratio, times interest earned ratio).
Chapter 4:
Purpose of income statement, income from continuing operations, operating vs. nonoperating income, income statement formats, separately reported items - intraperiod tax allocation, discontinued operations, extraordinary items, accounting changes – change in principle, change in depreciation method, change in estimate, change in reporting entity, correction of accounting errors, EPS disclosure, comprehensive income, statement of cash flows – cash flows from operating activities (direct and indirect method), cash flows from investing activities and cash flows from financing activities.

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