FI504 Final Exam Study Guide The FI504 Final Exam will be an online open-book, open-notes, opencomputer exam

with a time limit of 3 hours and 30 minutes. It will be worth 250 points or 25% of the course grade. The Final Exam is 3 pages long and will consist of 30 multiple-choice questions and 4 essays. The multiple-choice questions are worth 5 points each. Some of the multiple choice questions are problem-based. There are also 3 problems worth 25 points each and 1 essay question worth 25 points. Terminal Course Objectives A, B, C, D, E, and F are all addressed on this exam. You should review the following concepts for this exam.
For the multiple choice questions worth a total of 150 points, you should know: 1. the characteristics of the corporate form of business. 2. the meaning of operating, investing and financing activities. 3. how to calculate earnings per share (simple situation) 4. the meaning of "free cash flow". 5. about the term "cash dividend". 6. which accounts have debit or credit balances. 7. the difference between cash-basis versus accrual basis of accounting. 8. how to make an adjusting entry when needed. 9. the gross and net methods of recording purchase and sale of merchandise. 10. the calculation of cost of goods sold and gross profit, when you know the information about sales, inventories and purchases. 11. the meaning and implications of using FIFO, LIFO and weighted average costflow assumptions. 12. the definitions of inventory turnover ratio and days in inventory. 13. the concept of internal control and the purpose that it serves, as well as its limitations, and about internal control over cash-related activities. 14. how to read the information that appears on the debit and credit side of the allowance for doubtful accounts. 15. how the various components (amounts) within the allowance for doubtful account affect one another. 16. how to arrive at the acquisition cost of a plant asset and the meaning of the Cost Principle. 17. how to calculate depreciation using the straight-line method. 18. the journal entries made when a company collects sales tax from customers and remits it to the government. 19. the journal entry for the issuance of bonds (at par, discount or premium) and for the issuance of stock (at par or above par) 20. the meaning of cumulative and non-cumulative preferred stock and the resulting dividend calculation. 1

FI504 Final Exam Study Guide

21. the various adjustments that are made to net income in arriving at net cash flow from operating activities. 22. the different tools of financial statement analysis, and how each tool is used, as well as the different names for certain tools of analysis. 23. the different ratios, why/how those ratios are used, and which external user is interested in a certain ratio. For the essay questions worth a total of 75 points, you should know: 1. how to calculate the different ratios that you learned in this class. 2. how to prepare income statement and statement of retained earnings. 3. how to prepare the "net cash flow from operating activities" section of a statement of cash flows, using the indirect method. For the essay question worth a total of 25 points, you should know: 1. the interrelationships between financial statements 2. the objectives and purpose/importance of internal control 3. the composition of stockholders' equity section in a corporate balance sheet.

A good way to prepare for this exam in addition to reading Chapters 1 through 13 is to replay the Live Lectures and review the Illustrations and solutions for the problems listed below. Helpful Textbook Illustrations
Illustration 1-2 on page 6 Illustration 1-3 on page 7 Illustration 1-9 on page 16 Illustration 1-10 on page 17 Illustration 2-1 on page 48 Illustration 2-2 on page 49 Illustration 2-3 on page 50 Illustration 2-4 on page 50 Illustration 2-5 on page 51 Illustration 2-6 on page 51 Illustration 2-7 on page 52 Illustration 2-8 on page 53 Illustration 2-9 on page 54 Illustration 2-11 on page 56 Illustration 3-2 on page 104 Illustration 3-3 on page 109 Illustration 3-4 on page 110 Illustration 3-15 on page 115 Illustration 3-16 on page 115 Illustration 3-34 on page 129 Illustration 4-1 on page 163 Illustration 4-2 on page 164

FI504 Final Exam Study Guide

Illustration 4-23 on page 179 Illustration 4-25 on page 185 Illustration 4-26 on page 185 Illustration 4-33 on page 188 Illustration 5-1 on page 224 Illustration 5-2 on page 225 Illustration 5-4 on page 226 Illustration 5-6 on page 229 Illustration 5-7 on page 235 Illustration 5-8 on page 236 Illustration 5-9 on page 236 Illustration 5-11 on page 239 Illustration 5-12 on page 240 Illustration 5-15 on page 242 Illustration 5-17 on page 244 Illustration 6-1 on page 278 Illustration 6-5 on page 282 Illustration 6-7 on page 283 Illustration 6-10 on page 284 Illustration 6-12 on page 286 Illustration 6-16 on page 291 Illustration 7-4 on page 338 Illustration 7-6 on page 341 Illustration 8-3 on page 390 Illustration 9-2 on page 436 Illustration 9-6 on page 440 Illustration 9-8 on page 441 Illustration 9-9 on page 441 Illustration 9-10 on page 442 Illustration 9-11 on page 443 Illustration 9-12 on page 443 Illustration 10-8 on page 500 Illustration 10-9 on page 500 Illustration 11-7 on page 560 Illustration 11-8 on page 562 Illustration 11-16 on page 570 Illustration 12-1 on page 604 Illustration 12-6 on page 610 Illustration 12-12 on page 614 Illustration 12-14 on page 616 Illustration 13-8 on page 668 Illustration 13-9 on page 668 Illustration 13-11 on page 669 Illustration 13-12 on page 669 Illustration 13-13 on page 671 Illustration 13-14 on page 672 Illustration 13-16 on page 673 Illustration 13-17 on page 674 Illustration 13-18 on page 674 Illustration 13A-16 on page 689 Illustration 13A-20 on page 691

FI504 Final Exam Study Guide Helpful Textbook Problems Problem 1-3A on page 38 Problem 1-4A on page 38 Exercise 2-4 on page 82 Exercise 2-7 on page 83 Exercise 3-1 on page 140 Exercise 3-15 on page 144 Problem 3-2A on pages 145 and 16 Exercise 4-4 on page 202 Exercise 4-13 on page 205 Exercise 5-7 on page 256 Problem 5-4A on pages 259 and 260 Exercise 6-4 on page 308 Exercise 7-4 on page 365 Exercise 12-2 on page 640 Exercise 12-6 on page 641 Exercise 13-5 on page 702

End of Study Guide for Final Exam.