| |
| |
| About Our Author | |
| |
| |
| About Research & Education Association | |
| |
| |
| Acknowledgments | |
| |
| |
| Preface | |
| |
| |
| |
| Passing the CLEP Financial Accounting Exam | |
| |
| |
| Getting Started | |
| |
| |
| The REA Study Center | |
| |
| |
| An Overview of the Exam | |
| |
| |
| All About the CLEP Program | |
| |
| |
| Options for Military Personnel and Veterans | |
| |
| |
| SSD Accommodations for Candidates with Disabilities | |
| |
| |
| 6-Week Study Plan | |
| |
| |
| Test-taking Tips | |
| |
| |
| The Day of the Exam | |
| |
| |
| Online Diagnostic Test.. www.rea.com/studycenter | |
| |
| |
| |
| Getting Started | |
| |
| |
| |
| Balloon Party, Lauren's New Business | |
| |
| |
| |
| Lauren's First Accounting | |
| |
| |
| |
| The Balance Sheet Introduced | |
| |
| |
| |
| Analyzing the Balance Sheet | |
| |
| |
| |
| Operating Cycle and Fiscal Year | |
| |
| |
| |
| Making Money | |
| |
| |
| |
| Operating the Business | |
| |
| |
| |
| Making Adjustments | |
| |
| |
| |
| The Income Statement Refined | |
| |
| |
| |
| The Statement of Owner's Equity | |
| |
| |
| |
| Keeping Track of Numbers in Accounts | |
| |
| |
| |
| Using T-Accounts | |
| |
| |
| |
| How Operations Affect the Balance Sheet | |
| |
| |
| |
| Watching Over Cash | |
| |
| |
| |
| Lauren Decides She Needs to Watch Over Cash | |
| |
| |
| |
| Cash from Operations | |
| |
| |
| |
| Cash from Investing Activities | |
| |
| |
| |
| Cash from Financing Activities | |
| |
| |
| |
| The Direct Method of Presenting the Cash Flow Statement | |
| |
| |
| |
| Accounting Reports and the Outside World | |
| |
| |
| |
| Other Users of Lauren's Financial Statements | |
| |
| |
| |
| Making Sure the Statements Are Accurate | |
| |
| |
| |
| Debits and Credits | |
| |
| |
| |
| Introducing Debits and Credits | |
| |
| |
| |
| Posting the Start-Up Transactions in the T-Accounts | |
| |
| |
| |
| T-Accounts for Income and Expenses | |
| |
| |
| |
| Posting Operations to T-Accounts | |
| |
| |
| |
| Closing Temporary Accounts | |
| |
| |
| |
| Correcting Errors | |
| |
| |
| |
| Normal Balances of Accounts | |
| |
| |
| |
| Journals and Ledgers | |
| |
| |
| |
| The General Journal | |
| |
| |
| |
| The General Ledger | |
| |
| |
| |
| Specialized Journals | |
| |
| |
| |
| How to Write Vertical Journal Entries | |
| |
| |
| |
| Controls and Ethics | |
| |
| |
| |
| Why Balloon Party Should Have Internal Controls | |
| |
| |
| |
| Lauren Designs Balloon Party's Internal Controls | |
| |
| |
| |
| Ethics | |
| |
| |
| |
| All Internal Controls Are Imperfect | |
| |
| |
| |
| This Chapter Has Not Told Everything | |
| |
| |
| |
| Cash and Short-Term Investments | |
| |
| |
| |
| Reconciling the Bank Statement | |
| |
| |
| |
| Setting Up a Petty Cash System | |
| |
| |
| |
| Investing in Short-Term Securities | |
| |
| |
| |
| Accounts Receivable | |
| |
| |
| |
| Accrual Accounting for Accounts Receivable | |
| |
| |
| |
| Cash Basis Accounting for Sales on Account | |
| |
| |
| |
| The Direct Write-Off Method for Bad Debts | |
| |
| |
| |
| Other Receivables | |
| |
| |
| |
| Discounting a Note Receivable at the Bank | |
| |
| |
| |
| Accruing Interest Receivable | |
| |
| |
| |
| A Customer Dishonors a Note | |
| |
| |
| |
| Loans Receivable | |
| |
| |
| |
| Analysis of Current Assets | |
| |
| |
| |
| Merchandise Inventories | |
| |
| |
| |
| Two Methods for Handling Inventory | |
| |
| |
| |
| The Perpetual Inventory Method | |
| |
| |
| |
| Following the Trail of Debits | |
| |
| |
| |
| The Periodic Inventory Method | |
| |
| |
| |
| Comparing the Four Inventory Systems and Two Methods | |
| |
| |
| |
| Analyzing How Well a Business Handles Inventory | |
| |
| |
| |
| Supplies and Prepaids | |
| |
| |
| |
| Accounting for Prepaid Assets | |
| |
| |
| |
| Two Methods to Account for Operating Supplies | |
| |
| |
| |
| Buying and Selling Plant Assets | |
| |
| |
| |
| Balloon Party Buys a Group of Machines | |
| |
| |
| |
| Repairs or Improvements | |
| |
| |
| |
| Disposing of Fixed Assets | |
| |
| |
| |
| Vertical Journal Entries for Fixed Assets | |
| |
| |
| |
| The Cash Flow Statement and Fixed Assets | |
| |
| |
| |
| Depreciation | |
| |
| |
| |
| Depreciation: Allocating the Cost of Plant Assets | |
| |
| |
| |
| The Depreciation Expense Formula | |
| |
| |
| |
| Depreciation Conventions | |
| |
| |
| |
| The Depreciation Schedule | |
| |
| |
| |
| Changing Accounting Estimates | |
| |
| |
| |
| Land, Natural Resources, and Intangible Assets | |
| |
| |
| |
| Land or Land Improvement? | |
| |
| |
| |
| Assets You Cannot Grab Hold Of | |
| |
| |
| |
| Natural Resources | |
| |
| |
| |
| Vertical Journal Entries for Intangible Assets | |
| |
| |
| |
| Current Liabilities | |
| |
| |
| |
| What Does It Mean to "Accrue" a Liability? | |
| |
| |
| |
| Adjusting Entries at the End of the Period | |
| |
| |
| |
| Make Sure Wages Get Counted at the End of the Period | |
| |
| |
| |
| Estimating Warranty Expense | |
| |
| |
| |
| Loan Amortization Schedules | |
| |
| |
| |
| Accruing Interest Expense | |
| |
| |
| |
| Reversing Entries�Making Adjusting Entries Easier | |
| |
| |
| |
| Long-Term Liabilities | |
| |
| |
| |
| What Are Bonds? | |
| |
| |
| |
| Recording the Money Received When Issuing Bonds | |
| |
| |
| |
| Making the Periodic Cash Payments for Bonds | |
| |
| |
| |
| Deferring the Recognition of Revenues | |
| |
| |
| |
| The Equity Section | |
| |
| |
| |
| The Sole Proprietorship Becomes a Partnership | |
| |
| |
| |
| What Is a Corporation? | |
| |
| |
| |
| Balloon Party Partnership Incorporates | |
| |
| |
| |
| Paying a Dividend | |
| |
| |
| |
| Treasury Stock | |
| |
| |
| |
| Closing Entries for a Corporation | |
| |
| |
| |
| The Final Word on Financial Statements | |
| |
| |
| |
| The Complete Income Statement | |
| |
| |
| |
| The Complete Statement of Stockholders' Equity | |
| |
| |
| |
| The Comprehensive Balance Sheet | |
| |
| |
| |
| The Complete Cash Flow Statement | |
| |
| |
| |
| Financial Analysis Methods | |
| |
| |
Practice Test
1. (also available online at www.rea.com/studycenter) | |
| |
| |
| Answer Key | |
| |
| |
| Detailed Explanations of Answers | |
| |
| |
Practice Test
2. (also available online at www.rea.com/studycenfer) | |
| |
| |
| Answer Key | |
| |
| |
| Detailed Explanations of Answers | |
| |
| |
| Anser Sheets | |
| |
| |
| Index | |
