Exam (elaborations)

WALL STREET PREP EXAM (ACCOUNTING CRASH COURSE) QUESTIONS AND CORRECT ANSWERS 2024/2025.

1 purchase

Course
CRASH

Institution
Liberty University

WALL STREET PREP EXAM (ACCOUNTING CRASH COURSE) QUESTIONS AND CORRECT ANSWERS 2024/2025. 2 / 30 m the federal ations ompanies he securities EC Financial 1. What is Accounting?: Accounting is the language of business; it is a standard set of rules for measuring a company's financial perf...

[Show more]

Preview 3 out of 30 pages

View example

Uploaded on April 29, 2024
Number of pages 30
Written in 2023/2024
Type Exam (elaborations)
Contains Questions & answers

wall street prep exam accounting crash course qu

Tutor23 Member since 3 year 1861 documents sold

117

$11.49

Add to cart

Add to wishlist

100% satisfaction guarantee
Immediately available after payment
Both online and in PDF
No strings attached

WALL STREET PREP EXAM (ACCOUNTING CRASH COURSE ) QUESTIO NS AND CORRECT ANSWERS 2024/2025. m the federal ations ompanies he securities EC Financial 1. What is Accounting?: Accounting is the language of business; it is a standard set of rules for measuring a company's financial performance. Assessing a company's financial performance is important for: The firm's officers (managers and employees) Investors Lenders General public Standard financial statements serve as a "yardstick" of communicating financial performance to the general public. 2. Why is Accounting Important?: Enables managers to make corporate deci- sions Enables the general public to make investment decisions 3. Who Uses Accounting?: Used by a variety of organizations - fro government to non-profit organizations to small businesses to corpor We will discuss accounting rules as they pertain to publicly -traded c 4. Accounting Regulations: Accounting attempts to standardize financial informa - tion and follows rules and regulations These rules are called Generally Accepted Accounting Principles (GAAP) In the US, the Securities and Exchange Commision (SEC) authorizes the Financial Accounting Standards Board (FASB) to determine accounting rules GAAP comes from the Statements of Financial Accounting Standards (SFAS) issued by the FASB 5. An Overview of the SEC: A US federal agency established by the US Congress in 1934 Primary mission is "to protect investors and maintain the integrity of t markets" Division of Corporate Finance oversees FASB 6. An Overview of FASB: Established in 1973 as an independent body to carry out the function of codifying accounting standards on the behalf of the S Composed of seven full-time members appointed for five years by the Account Foundation (FAF) Decisions are influenced by: 7. International Financial Reporting Standards (IFRS): Over 100 countries, in- cluding the EU, UK, Canada, Australia, and Russia, have adopted a unified set of international accounting standards (IFRS) Although we have seen unprecedented convergence over the last few years be- tween US GAAP and IFRS, some differences remain with making 8. Assumption 1: Accounting Entity: A company is considered a separate "living" enterprise, apart from its owners In other words, a corporation is a "fictional" being 9. Assumption 2: Going Concern: A company is considered a "going concern" for the foreseeable future; it is assumed to remain in existence indefinitely 10. Assumption 3: Measurement: Financial statements can only show measurable activities of a corporation such as its quantifiable resources, its liability, amount of taxes i t is facing, etc. 11. Assumption 4: Periodicity: Companies are required to file annual and interim reports In the US, quarterly and annual financial reports are required An accounting year (fiscal year) is frequently aligned with the calendar year 12. Four Underlying Assumptions of Accounting: (1) Accounting Entity (2) Going Concern (3) Measurement (4) Periodicity 13. Principle 1: Historical Cost: Financial statements report companies' resources at an initial historical cost Why? Represents the easiest measurement method without a need for appraisal and revaluation Marking resources up to fair value allows for management discretion and subjectivity, which US GAAP attempts to minimize by using historical cost Note: IFRS allows you to write up the asset to fair value, but most companies use historical value anyways 14. Principles 2 and 3: Accrual Accounting (Revenue Recognition and Match - ing Principle): Governs the company's timing in recording its revenues (i.e. sales) and associated expenses 2) Revenue Recognition: Accrual basis of accounting dictates that revenues must be recorded when earned and measurable 3) Matching Principle: Under the matching principle, costs associated a product must be recorded during the same period as revenue generated from that product Exercise Answer: 1) 1/4/15; 2) 1/4/15 15. Why can't companies immediately record these revenues and expenses? - : According to the revenue recognition principle, a company cannot record revenue until that order is shipped to a customer (only then, is the revenue actually earned) and collection from that customer is reasonably assured

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller Tutor23. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $11.49. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

69052 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 15 years now

Start selling

Exam (elaborations)

WALL STREET PREP EXAM (ACCOUNTING CRASH COURSE) QUESTIONS AND CORRECT ANSWERS 2024/2025.

Document information

Subjects

Written for

Seller

Reviews received

Content preview