CCIFP Accounting and Reporting 2026
Exam Questions and Answers23
Current Ratio - ANSWERS-Current Assets/Current Liabilities
Return on Equity - ANSWERS-Net Income/Total Net Worth (or Total Stockholders Equity)
Return on Assets - ANSWERS-Net Income/Total Assets
Debt to Equity Ratio - ANSWERS-Total Liabilities/Stockholders Equity
Asset Turnover Ratio - ANSWERS-Net Sales/Total Assets
Days in Accounts Receivable (AR) - ANSWERS-(Accounts Receivable/Total Credit Sales) x Number
of Days
Return on Sales - ANSWERS-Operating Profit (EBIT)/Revenue
Months Revenue in Backlog - ANSWERS-Backlog Gross Revenue/(Annual Revenue/12)
What are assets constructed and intended for sale or lease? - ANSWERS-Qualifying assets that
warrant capitalization of interest.
Statement of Position on Scope applies to _________? - ANSWERS-Accounting for performance
contracts for which specifications are provided by the customer for the construction of facilities
,or the production of goods or the provisions of related services that are reported in financial
statements prepared in conformity with generally accepted accounting principles.
Working Capital Turnover - ANSWERS-Gross Revenue/(Current Assets - Current Liabilities)
Fixed Asset Turnover Ratio - ANSWERS-Net Sales/Average Net Fixed Assets
What are two (2) accepted methods of accounting - reporting for construction? - ANSWERS-1)
POC - Percentage of Completion Method 2) CCM - Completed Contract Method
Cost Recovery - ANSWERS-The recovery of specific costs (identified in the construction contract)
throughout the life of a project.
3 Risks Addressed with Internal Controls - ANSWERS-Financial Reporting, Regulatory
Compliance, Operations
What is the zero gross profit option for the completed contract method? - ANSWERS-Recognizes
revenue and cost for the period, but zero gross profit allows company to show costs for the
period.
Why do Accountants use GAAP? - ANSWERS-Accountants adhere to GAAP for consistency,
fairness, honesty and accuracy in measuring and disclosing financial information.
What is financial reporting 4 components? - ANSWERS-Financial reporting includes the
following: the external financial statements (balance sheet, income statement, statement of
cash flows and statement of stockholders.
When accounting for losses, what is recommended method of recording? - ANSWERS-Should be
as additional costs not reduction of revenue
, Gross Profit - ANSWERS-Gross Profit is net sales minus the cost of goods sold. (Sometimes
referred to as GP or (GM) Gross margin.
Three objectives of Financial Managers - ANSWERS-1) Profitability 2)Liquidity 3) Financial
Reporting
Job Profitability - ANSWERS-The financial manager should ensure that margins on jobs are
maximized through cost recovery.
Monetary Unit Assumption - ANSWERS-Part of the "Monetary" unit assumption is that the U.S.
dollar retains its purchasing power over time
Matching Principle - ANSWERS-Adjusting entries help to achieve the "Matching" principle.
Original Cost Principle - ANSWERS-Under US GAAP, most assets are held at their original costs
(less depreciation or impairment) as opposed to fair value.
Industry Practice - ANSWERS-Allows the format of public utility's balance sheet to be different
from that of a manufacturer.
Materiality - ANSWERS-Allows for the violation of the accounting principle when the amounts
are insignificant.
What is ABC? - ANSWERS-Activity-Based Costing 1) Links indirect costs to activities 2)Allocates
"activity" cost to jobs based on specific attributes
Economic - ANSWERS-The entity assumptions results in business transactions being kept
separate from a sole proprietor's.
Exam Questions and Answers23
Current Ratio - ANSWERS-Current Assets/Current Liabilities
Return on Equity - ANSWERS-Net Income/Total Net Worth (or Total Stockholders Equity)
Return on Assets - ANSWERS-Net Income/Total Assets
Debt to Equity Ratio - ANSWERS-Total Liabilities/Stockholders Equity
Asset Turnover Ratio - ANSWERS-Net Sales/Total Assets
Days in Accounts Receivable (AR) - ANSWERS-(Accounts Receivable/Total Credit Sales) x Number
of Days
Return on Sales - ANSWERS-Operating Profit (EBIT)/Revenue
Months Revenue in Backlog - ANSWERS-Backlog Gross Revenue/(Annual Revenue/12)
What are assets constructed and intended for sale or lease? - ANSWERS-Qualifying assets that
warrant capitalization of interest.
Statement of Position on Scope applies to _________? - ANSWERS-Accounting for performance
contracts for which specifications are provided by the customer for the construction of facilities
,or the production of goods or the provisions of related services that are reported in financial
statements prepared in conformity with generally accepted accounting principles.
Working Capital Turnover - ANSWERS-Gross Revenue/(Current Assets - Current Liabilities)
Fixed Asset Turnover Ratio - ANSWERS-Net Sales/Average Net Fixed Assets
What are two (2) accepted methods of accounting - reporting for construction? - ANSWERS-1)
POC - Percentage of Completion Method 2) CCM - Completed Contract Method
Cost Recovery - ANSWERS-The recovery of specific costs (identified in the construction contract)
throughout the life of a project.
3 Risks Addressed with Internal Controls - ANSWERS-Financial Reporting, Regulatory
Compliance, Operations
What is the zero gross profit option for the completed contract method? - ANSWERS-Recognizes
revenue and cost for the period, but zero gross profit allows company to show costs for the
period.
Why do Accountants use GAAP? - ANSWERS-Accountants adhere to GAAP for consistency,
fairness, honesty and accuracy in measuring and disclosing financial information.
What is financial reporting 4 components? - ANSWERS-Financial reporting includes the
following: the external financial statements (balance sheet, income statement, statement of
cash flows and statement of stockholders.
When accounting for losses, what is recommended method of recording? - ANSWERS-Should be
as additional costs not reduction of revenue
, Gross Profit - ANSWERS-Gross Profit is net sales minus the cost of goods sold. (Sometimes
referred to as GP or (GM) Gross margin.
Three objectives of Financial Managers - ANSWERS-1) Profitability 2)Liquidity 3) Financial
Reporting
Job Profitability - ANSWERS-The financial manager should ensure that margins on jobs are
maximized through cost recovery.
Monetary Unit Assumption - ANSWERS-Part of the "Monetary" unit assumption is that the U.S.
dollar retains its purchasing power over time
Matching Principle - ANSWERS-Adjusting entries help to achieve the "Matching" principle.
Original Cost Principle - ANSWERS-Under US GAAP, most assets are held at their original costs
(less depreciation or impairment) as opposed to fair value.
Industry Practice - ANSWERS-Allows the format of public utility's balance sheet to be different
from that of a manufacturer.
Materiality - ANSWERS-Allows for the violation of the accounting principle when the amounts
are insignificant.
What is ABC? - ANSWERS-Activity-Based Costing 1) Links indirect costs to activities 2)Allocates
"activity" cost to jobs based on specific attributes
Economic - ANSWERS-The entity assumptions results in business transactions being kept
separate from a sole proprietor's.
