CBA REVIEWED QUESTIONS WITH
100% GUARANTEED A+ GRADE
ANSWERS [NEWEST EDITION
2026/2027]
Net trade cycle - Correct Answers -=average collection period+days inventory held-days payable
outstanding. Also known as the cash conversion cycle, measures the number of days that it
takes to collect cash, sell inventory and purchases on credit, liquidity ratio, helps the analyst
understand why cash flow generation has improved (or not)
Average collection period - Correct Answers -= net accounts receivable/ average daily sales -
liquidity ratio, represents the average # of days required to convert receivables into cash-the
lower the better
Average daily sales - Correct Answers -= sales/365
Days inventory held - Correct Answers -=inventory/average daily cost of sales - liquidity
measure, average # of days it takes to sell inventory to customers, measures the efficiency of
selling inventory, sign of efficient management, the lower the better bc, the less time it takes to
sell inventory the less $$ is tied up in inventory, but if too low could mean under stocking and
lost orders
Average daily cost of sales - Correct Answers -=cost of goods sold /365
Days payable outstanding - Correct Answers -=accounts payable/average daily cost of sales -
liquidity ratio, the higher the better, bc the firm can earn a return on the cash being held
Five account types - Correct Answers -Expense, revenue, asset, liability and equity
,Sole proprietorship - Correct Answers -A business that is owned by one person, all assets,
profits, losses and debts fall under one owner, largest in #s, no income tax, profits roll into
personal, smallest in aggregate, do not have to register as forge in business in various states
Partner types - Correct Answers -General, limited or silent
Corporation - Correct Answers -Legal entity created by either a state of federal statue
authorizing individuals to operate and enterprise
Corporation types - Correct Answers -Private closed, private not closed, quasi public
Private closed corporations - Correct Answers -35 shareholders
Private not closed - Correct Answers -5xx shareholders
Quasi public corporations - Correct Answers -Can buy stock on open market, but are
government ran, utility government
General patnership - Correct Answers -Two or more owners, net income rolls into each partner's
personal tax returns, do not have to register I foreign business in various states
C-corporation - Correct Answers -Any corporation that is taxed separately from the owners, pays
a dividend, most common corporation, must register with each state that business is conducted
in, pay federal and state income tax
Asset And expense T account - Correct Answers -Increase with debit, decrease with credit
, Limited partnership - Correct Answers -Two or more owners, at least one general and one
limited partner
Equity, liability and revenue T accounts - Correct Answers -Increase with credit, decrease with
debit
When the Fed buys securities - Correct Answers -Bank reserves increase, fewer funds area silane
for lending, borrowers/businesses are discouraged from lending, interest rates rise
When the Fed sells securities - Correct Answers -Bank reserves decrease, more funds are
available for lending, borrowers/businesses are encouraged to borrow, interest rates decline
Adjusting journal entries - Correct Answers -Prepaids, unearned revenues, accrued expenses,
accrued revenues
Prepaid original entry - Correct Answers -Debit prepaid account, credit cash
Prepaid adjusting entry - Correct Answers -Debit expense account, credit prepaid account
Unearned revenue original entry - Correct Answers -Debit cash, credit unearned revenue
Unearned revenue adjusting entry - Correct Answers -Debit unearned revenue account, credit
revenue account
Unearned revenue account type - Correct Answers -Liability
Accrued expense original entry - Correct Answers -Debit expense account ($300), credit payable
account ($300)
100% GUARANTEED A+ GRADE
ANSWERS [NEWEST EDITION
2026/2027]
Net trade cycle - Correct Answers -=average collection period+days inventory held-days payable
outstanding. Also known as the cash conversion cycle, measures the number of days that it
takes to collect cash, sell inventory and purchases on credit, liquidity ratio, helps the analyst
understand why cash flow generation has improved (or not)
Average collection period - Correct Answers -= net accounts receivable/ average daily sales -
liquidity ratio, represents the average # of days required to convert receivables into cash-the
lower the better
Average daily sales - Correct Answers -= sales/365
Days inventory held - Correct Answers -=inventory/average daily cost of sales - liquidity
measure, average # of days it takes to sell inventory to customers, measures the efficiency of
selling inventory, sign of efficient management, the lower the better bc, the less time it takes to
sell inventory the less $$ is tied up in inventory, but if too low could mean under stocking and
lost orders
Average daily cost of sales - Correct Answers -=cost of goods sold /365
Days payable outstanding - Correct Answers -=accounts payable/average daily cost of sales -
liquidity ratio, the higher the better, bc the firm can earn a return on the cash being held
Five account types - Correct Answers -Expense, revenue, asset, liability and equity
,Sole proprietorship - Correct Answers -A business that is owned by one person, all assets,
profits, losses and debts fall under one owner, largest in #s, no income tax, profits roll into
personal, smallest in aggregate, do not have to register as forge in business in various states
Partner types - Correct Answers -General, limited or silent
Corporation - Correct Answers -Legal entity created by either a state of federal statue
authorizing individuals to operate and enterprise
Corporation types - Correct Answers -Private closed, private not closed, quasi public
Private closed corporations - Correct Answers -35 shareholders
Private not closed - Correct Answers -5xx shareholders
Quasi public corporations - Correct Answers -Can buy stock on open market, but are
government ran, utility government
General patnership - Correct Answers -Two or more owners, net income rolls into each partner's
personal tax returns, do not have to register I foreign business in various states
C-corporation - Correct Answers -Any corporation that is taxed separately from the owners, pays
a dividend, most common corporation, must register with each state that business is conducted
in, pay federal and state income tax
Asset And expense T account - Correct Answers -Increase with debit, decrease with credit
, Limited partnership - Correct Answers -Two or more owners, at least one general and one
limited partner
Equity, liability and revenue T accounts - Correct Answers -Increase with credit, decrease with
debit
When the Fed buys securities - Correct Answers -Bank reserves increase, fewer funds area silane
for lending, borrowers/businesses are discouraged from lending, interest rates rise
When the Fed sells securities - Correct Answers -Bank reserves decrease, more funds are
available for lending, borrowers/businesses are encouraged to borrow, interest rates decline
Adjusting journal entries - Correct Answers -Prepaids, unearned revenues, accrued expenses,
accrued revenues
Prepaid original entry - Correct Answers -Debit prepaid account, credit cash
Prepaid adjusting entry - Correct Answers -Debit expense account, credit prepaid account
Unearned revenue original entry - Correct Answers -Debit cash, credit unearned revenue
Unearned revenue adjusting entry - Correct Answers -Debit unearned revenue account, credit
revenue account
Unearned revenue account type - Correct Answers -Liability
Accrued expense original entry - Correct Answers -Debit expense account ($300), credit payable
account ($300)
