ACCT 201A Final Exam Review CSUF – Complete Guide
Working Capital Right Ans - current assets - current liabilities
Current Ratio Right Ans - current assets - current liabilities
Debt to Assets Ratio Formula Right Ans - Total Debt/Total Assets
AR turnover ratio Right Ans - Net Credit Sales/Average AR
Inventory Turnover Ratio Right Ans - COGS/Average Inventory
Gross Profit Rate Right Ans - Gross Profit/Net Sales
Profit Margin Ratio Right Ans - Net Income/Net Sales
Income Statement Right Ans - A financial statement showing:
Revenues
Expenses
Net Income
Net Income is needed to determine the... Right Ans - ...ending balance in
Retained Earnings.
Retained Earnings Statement Right Ans - A financial statement that
summarizes the amounts and causes of changes in retained earnings for a
specific time period:
Retained earnings, starting date
Add: Net Income
Less: Dividends
Retained earnings, end date.
Balance Sheet Right Ans - A financial statement that reports assets,
liabilities, and stock holders' equity on a specific date:
,Assets
Liabilities and Stockholders' Equity
Liabilities
Stockholders' equity
Ending balance in retained earnings is need in preparing... Right Ans - ...the
balance sheet.
Statement of Cash Flows Right Ans - A financial statement that provides
financial information about the cash receipts and cash payments of a business
for a specific period of time:
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net Increase in cash
Cash at beginning of period
Cash at end of period
What are the 4 component of the assets section in a Classified Balance Sheet?
Right Ans - Current assets
Long-term investments
Property, plant, and equipment
Intangible assets
What are the 3 components of the liabilities and stock holders' equity section
in a Classified Balance Sheet? Right Ans - Current liabilities
Long-term liabilities
, Stockholders' equity
Liquidity Definition Right Ans - Measures short-term ability of the
company to pay its maturing obligations and to meet unexpected needs for
cash.
Solvency Definition Right Ans - Measures the ability of the company to
survive over a long period of time.
Profitability Definition Right Ans - Measures the income or operating
success of a company for a given period of time.
Generally Accepted Accounting Principles (GAAP) Right Ans - A set of rules
and practices, having substantial authoritative support, that the accounting
profession recognizes as a general guide for financial reporting purposes.
Comparability Definition Right Ans - Ability to easily evaluate one
company's results relative to another's.
Going Concern Definition Right Ans - Belief that a company will continue to
operate for the foreseeable future.
Materiality Definition Right Ans - The judgment concerning whether an
item is large enough to matter to decision-makers.
Full Disclosure Definition Right Ans - The reporting of all information that
would make a difference to financial statement users.
Periodicity Definition Right Ans - The practice of preparing financial
statements at regular intervals.
Relevance Definition Right Ans - The quality of information that indicates
the information makes a difference in a decision.
Historical Cost Definition Right Ans - Belief that items should be reported
on the balance sheet at the price that was paid to acquire the item.
Working Capital Right Ans - current assets - current liabilities
Current Ratio Right Ans - current assets - current liabilities
Debt to Assets Ratio Formula Right Ans - Total Debt/Total Assets
AR turnover ratio Right Ans - Net Credit Sales/Average AR
Inventory Turnover Ratio Right Ans - COGS/Average Inventory
Gross Profit Rate Right Ans - Gross Profit/Net Sales
Profit Margin Ratio Right Ans - Net Income/Net Sales
Income Statement Right Ans - A financial statement showing:
Revenues
Expenses
Net Income
Net Income is needed to determine the... Right Ans - ...ending balance in
Retained Earnings.
Retained Earnings Statement Right Ans - A financial statement that
summarizes the amounts and causes of changes in retained earnings for a
specific time period:
Retained earnings, starting date
Add: Net Income
Less: Dividends
Retained earnings, end date.
Balance Sheet Right Ans - A financial statement that reports assets,
liabilities, and stock holders' equity on a specific date:
,Assets
Liabilities and Stockholders' Equity
Liabilities
Stockholders' equity
Ending balance in retained earnings is need in preparing... Right Ans - ...the
balance sheet.
Statement of Cash Flows Right Ans - A financial statement that provides
financial information about the cash receipts and cash payments of a business
for a specific period of time:
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net Increase in cash
Cash at beginning of period
Cash at end of period
What are the 4 component of the assets section in a Classified Balance Sheet?
Right Ans - Current assets
Long-term investments
Property, plant, and equipment
Intangible assets
What are the 3 components of the liabilities and stock holders' equity section
in a Classified Balance Sheet? Right Ans - Current liabilities
Long-term liabilities
, Stockholders' equity
Liquidity Definition Right Ans - Measures short-term ability of the
company to pay its maturing obligations and to meet unexpected needs for
cash.
Solvency Definition Right Ans - Measures the ability of the company to
survive over a long period of time.
Profitability Definition Right Ans - Measures the income or operating
success of a company for a given period of time.
Generally Accepted Accounting Principles (GAAP) Right Ans - A set of rules
and practices, having substantial authoritative support, that the accounting
profession recognizes as a general guide for financial reporting purposes.
Comparability Definition Right Ans - Ability to easily evaluate one
company's results relative to another's.
Going Concern Definition Right Ans - Belief that a company will continue to
operate for the foreseeable future.
Materiality Definition Right Ans - The judgment concerning whether an
item is large enough to matter to decision-makers.
Full Disclosure Definition Right Ans - The reporting of all information that
would make a difference to financial statement users.
Periodicity Definition Right Ans - The practice of preparing financial
statements at regular intervals.
Relevance Definition Right Ans - The quality of information that indicates
the information makes a difference in a decision.
Historical Cost Definition Right Ans - Belief that items should be reported
on the balance sheet at the price that was paid to acquire the item.
