Final Exam Study Guide: Chapters 1-10

Course: Barton ACCY 201, Spring 2025

Exam Details:

• Date: Wednesday, May 7, 2025
• Time: 7:30 pm to 10:30 pm
• Location: Jackson Avenue Center
• Format: 64 multiple choice questions (1.25 points each) and 1 problem from Chapter 10 (20 points)

Point Distribution:

• Chapter 1: 10 points (10%)
• Chapter 2: 8.75 points (9%)
• Chapter 3: 7.5 points (8%)
• Chapter 4: 10 points (10%)
• Chapter 5: 7.5 points (8%)
• Chapter 6: 7.5 points (8%)
• Chapter 7: 10 points (10%)
• Chapter 8: 7.5 points (8%)
• Chapter 9: 6.25 points (6%)
• Chapter 10: 25 points (25%)

Chapter 1: Accounting in Business

• Accounting Definition: Review on page 3.
• GAAP Principles: Measurement, Revenue Recognition, Expense Recognition, Full Disclosure, Going Concern, Monetary Unit, Time Period, Business Entity. (Pages 6-8)
• Basic Components: Assets, liabilities, and equity (page 9)
  • Accounting Equation: Assets = Liabilities + Equity
  • Example Calculations: Provided for understanding equation applications
• Financial Statements: Income statement, balance sheet, retained earnings.

Chapter 2: Accounting for Business Transactions

• Accounts and Ledgers: Basic understanding (Pages 45)
• Asset and Liability Accounts: Include new introductions like prepaid expenses and unearned revenues.
• Debits and Credits: Understand T-accounts and how transactions affect account balances.
• Net Income Calculation: Given account balances, be able to determine net income.

Chapter 3: Adjusting Accounts for Financial Statements

• Accrual vs. Cash Accounting: GAAP uses accrual basis (Page 86)
• Adjusting Entries: Affect income statement and balance sheet accounts.
• Categories of Adjustments: Prepaid expenses, unearned revenues, accrued expenses, etc.

Chapter 4: Accounting for Merchandising Operations

• Merchandising Concepts: Income computation, inventory systems (only perpetual).
• Credit Terms and Shipping Terms: Include calculations for discounts.
• Journal Entries: For inventory purchases, sales, and returns.

Chapter 5: Inventories and Cost of Sales

• Inventory Accounting: Ownership, cost considerations, and accounting methods like FIFO and LIFO.
• Inventory Methods: Understand differences and calculations.

Chapter 6: Cash, Fraud, and Internal Control

• Cash Management: Cash equivalents, bank reconciliations, petty cash systems.

Chapter 7: Accounting for Receivables

• Bad Debts: Allowance method for estimating and adjusting bad debts.
• Notes Receivable: Understanding of maturity dates and interest calculations.

Chapter 8: Accounting for Long-Term Assets

• Plant Assets: Cost determination and depreciation methods.
• Depreciation Calculations: Focus on straight-line method.

Chapter 9: Accounting for Current Liabilities

• Current Liabilities: Definitions and examples of short-term notes payable.
• Contingent Liabilities: Understanding when to record or disclose.

Chapter 10: Accounting for Long-Term Liabilities

• Bonds and Valuation: Par value, contract vs. market rate, discounts, premiums.
• Amortization: Straight-line amortization impact on interest expense.
• Bond Issuance Calculations: Premiums and discounts, carrying value adjustments.