FMVA CFI Exam Questions & Answers 2024/2025
Income statement accounting - ANSWERSAccrual - revenues & costs recorded as a business earns or incurs them, not as it receives and pays money
It includes them in the relevant period's income statement and matches them as closely as possible
CF mak...
Income statement accounting - ANSWERSAccrual - revenues & costs recorded as a business earns or
incurs them, not as it receives and pays money
It includes them in the relevant period's income statement and matches them as closely as possible
CF makes no difference whatsoever - IS where sale happens
=> How do you decide when sale happens? RECOGNIZE REV UPON DELIVERY OF GOOD/SERVICE
PERFORMED
Why are profits and cash flow not the same thing? - ANSWERSAccounting differences
The idea of matching over time - ANSWERS
CFS Accounting - ANSWERSOnly records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method - ANSWERSrecord income and expenditures at the time the money changes
hands
Cash accounting method - ANSWERSAn accounting method in which income and expenditures are
recorded at the time the money changes hands.
Accrual Accounting - ANSWERSrecording in each fiscal period applicable expenses, whether paid or not,
and income earned, whether collected or not.
Accrual Basis Accounting - ANSWERSreporting income when it is earned and expenses when they are
incurred
,Accrual Basis Accounting - ANSWERSthe method of accounting that recognizes revenue when it is earned
and matches expenses to the revenues they helped produce
Accrual Basis Accounting - ANSWERSAccounting basis in which companies record, in the periods in which
the events occur, transactions that change a company's financial statements, even if cash was not
exchanged.
accrued expenses - ANSWERSexpenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses - ANSWERSexpenses incurred but not yet paid in cash or recorded
Cash flow from operating activities - ANSWERSThe net amount of cash provided from operating
activities.
cash flow from financing activities - ANSWERS
The idea of matching over time - ANSWERS
CFS Accounting - ANSWERSOnly records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method - ANSWERSrecord income and expenditures at the time the money changes
hands
Cash accounting method - ANSWERSAn accounting method in which income and expenditures are
recorded at the time the money changes hands.
Accrual Accounting - ANSWERSrecording in each fiscal period applicable expenses, whether paid or not,
and income earned, whether collected or not.
,Accrual Basis Accounting - ANSWERSreporting income when it is earned and expenses when they are
incurred
Accrual Basis Accounting - ANSWERSthe method of accounting that recognizes revenue when it is earned
and matches expenses to the revenues they helped produce
Accrual Basis Accounting - ANSWERSAccounting basis in which companies record, in the periods in which
the events occur, transactions that change a company's financial statements, even if cash was not
exchanged.
accrued expenses - ANSWERSexpenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses - ANSWERSexpenses incurred but not yet paid in cash or recorded
Cash flow from operating activities - ANSWERSThe net amount of cash provided from operating
activities.
cash flow from financing activities - ANSWERSThe section of the statement of cash flows that reports
cash flows from transactions affecting the equity and debt of the business.
cash flow from financing activities - ANSWERSitems related to debt, dividends, and issuing or
repurchasing shares
cash flow from investing activities - ANSWERSThe section of the statement of cash flows that reports
cash flows from transactions affecting investments in noncurrent assets.
cash flow from investing activities - ANSWERSinvolves any cash in or out of the company due to
investment in or disposal of fixed assets.
Contributed surplus - ANSWERSAmount paid for shares in excess of their par value
, Contributed surplus - ANSWERSmoney that has been invested in the firm by outside parties
Contributed surplus - ANSWERSA source of contributed capital that can result from certain types of
equity transactions, including the reacquisition of shares.
Straightline depreciation - ANSWERSAllocates equal amounts of plant assets net cost to depreciation
during its useful life.
Accounts Receivable - ANSWERSAmounts to be received in the future due to the sale of goods or
services
Accounts Payable - ANSWERSAmounts to be paid in the future for goods or services already acquired
Cash Flow Accounting System - ANSWERSAn accounting system entering expenses and revenues only
when cash is received or paid out.
authorised share capital - ANSWERSMaximum number of shares that a company can issue, as specified
in the firm's memorandum of association
outstanding share capital - ANSWERSIssued share capital less the par value of shares that are held in the
company's treasury.
inventory - ANSWERSthe quantity of goods that a firm has on hand
inventory - ANSWERSa complete list of items such as property, goods in stock, or the contents of a
building.
Working Capital - ANSWERScurrent assets - current liabilities
Net Working Capital - ANSWERScurrent assets minus current liabilities
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