Acct 504 Study Guide

The ACCT504 Final Exam will be an online open-book, open-notes, open-computer exam with a time limit ofthree hours and 30 minutes. It will be worth250 points or25% of your course grade.

The Final Exam is two pages long and will consist of14 multiple-choice questions worth five points each and six essays worth 30 points. Some of the multiple-choice questions are problem-based. Of the six essays, five of the essays are problem-based since this is an Accounting course.

Terminal Course Objectives A, B, C, D, E, F, and G are all addressed on this exam.

You should review the following concepts for this exam.

For the multiple choice questions worth a total of 70 points, you should know:

1. The characteristics of the corporate form of business.

A. separate legal entity owned by stockholders

B. easy to transfer ownership

C. easy to raise funds

D. no personal liability

2. About the term "cash dividend".

E. most common form

F. dividends result in a reduction of the stockholders claims on retained earnings

G. Normal balance=debit

3. Which accounts have debit or credit balances.

H. Debit Credit

I. decrease revenue increase revenue

J. increase expenses decrease expenses

4. The difference between cash-basis versus accrual-basis of accounting

K. cash basis

1. records revenue only when cash is received and expense only when cash is paid

2. prohibited under GAAP bc it does not record revenue when earned, thus violating the revenue recognition principle

3. does not record expenses when incurred

L. accrual-basis

4. transactions that change a companys financial statements are recorded in the period in which the events occur

5. revenue is reognized when earned (ie the revenue recognition principle) even if there is no cash received

6. recognize expenses when incurred (ie expense recognition principle...