Principles of Accounting 1 (ACCT 2101) Fall 2013Study Guide for Final ExamTest Format:- Multiple choice questions (50 @ 6.25 points each). Total possible points are 312.50. - Maximum grade is 300! The extra points are to compensate for any weakness in themain test instrument and misunderstanding in the question wording. - Students need to bring their own scantron. Do not mark your scantron until you have selected your FINAL answer. Eraser marks confuse the scantron grading machine. All adverse consequences of eraser marks and mismarks are the student’s responsibility. Bring extra scantrons. - You are permitted to use a simple four-function calculator (cell phones are NOT simple four-function calculators). Instructors/exam proctors will check each student’s calculator while distributing the exams.- This is a closed book, closed note, and closed neighbor exam. You are NOT permitted to have scratch paper. You are NOT to look around during the exam. Youare to keep your scantron sheet covered to the extent possible. Questions regarding the exam cannot be asked during the exam period.- You must turn in your exam and scantron with your name, your instructor’s name, and the version letter of the exam on both. You will be asked to show a picture id when you turn in your exam and scantron. - You will have 120 minutes to complete the exam. - This exam covers Chapters 1 – 10. Approximately 40% of the exam will come from Chapters 9 & 10 and 60% from Chapter 1 – 8.Skills needed: Chapter 1:- Identify and understand the characteristics of the basic forms of business organization structures (i.e. sole proprietorship, partnership, and corporation).- Understand the elements of accounting (assets, liabilities, owners’ equity, revenue, expense, and net income).- Know the accounting equation and calculate accrual basis net income.- Identify the purpose and relationship among the four financial statements (Exhibit 1.4).Chapter 2:- Know the definition of operating, investing and financing activities.- Given a scenario, identify which of the five basic controls would be involved. (i.e. proper authorization, separation of duties, maintaining adequate documentation, physically controlling assets and information, and providing independent checks on performance).- Prepare a bank reconciliation.Chapter 3:- Understand the shipping terms of FOB destination and FOB shipping point.- Explain and calculate purchase discounts.- Understand cost and revenue behavior including fixed costs and revenues, variable costs and revenues, and mixed costs and revenues.- Use the high/low method to estimate costs or revenues.Chapter 4:- Solve cost-volume-profit problems.- Define sensitivity analysis and solve given a scenario.- Identify costs as unit-related, batch-related, product-sustaining, or facility-sustaining.- Solve a special order (accept or reject) problem.- Solve a product mix (keep or drop) problem.Chapter 5:- Calculate markups and/or markup percentages.- Calculate daily demand using the EOQ model.- Calculate a bonus based upon income before bonus and taxes and the related taxes and net income.Chapter 6:- Prepare a sales budget.- Prepare a cash receipts schedule.- Prepare a production budget.Chapter 7:- Identify and explain the impact of accounting events on the accounting equation.- Prepare or analyze journal entries.- Identify how accounting events are reported on the financial statements (see Exhibit 7.8).Chapter 8:- Describe the characteristics of the periodic and perpetual inventory systems.- Describe the characteristics of the net price method and record inventory activities using that method.- Calculate cash payments to suppliers.Chapter 9:- Track the flow of costs through the three types of inventory accounts used in a manufacturing firm.- Identify costs as direct materials, direct labor, or manufacturing overhead.- Calculate applied manufacturing overhead rates and analyze the manufacturing overhead account.- Calculate cost of goods sold before and after any application of over or under-applied overhead.- Prepare all or a portion of a cost of goods manufactured report.- Calculate usage and price variances for direct materials and direct labor.Chapter 10:- Explain how revenue process activities are analyzed, recorded in the accounting system, and reported on the financial statements.- Calculate cash receipts/collections or sales/net sales by analyzing the asset account, Accounts Receivable.- Analyze the account Allowance for Uncollectible Accounts.- Determine the impact on a company’s financial statements of using LIFO or FIFO.- Calculate cost of goods sold or ending inventory under LIFO or FIFO.- Define or analyze a sales quantity variance or a sales price