CFI FMVA LATEST UPDATED REAL 2025-2026 FINAL EXAM
WITH COMPLETE QUESTIONS AND DETAILED ANSWERS
ALREADY A+ GRADED
Income statement accounting
ANSWER-Accrual - revenues & costs recorded as a business
earns or incurs them, not as it receives and pays money
It includes them in the relevant period's income statement and
matches them as closely as possible
CF makes no difference whatsoever - IS where sale happens
=> How do you decide when sale happens? RECOGNIZE REV
UPON DELIVERY OF GOOD/SERVICE PERFORMED
Why are profits and cash flow not the same thing?
ANSWER-Accounting differences
The idea of matching over time
,ANSWER-CFS Accounting
Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method
ANSWER-record income and expenditures at the time the
money changes hands
Cash accounting method
ANSWER-An accounting method in which income and
expenditures are recorded at the time the money changes
hands.
Accrual Accounting
,ANSWER-recording in each fiscal period applicable expenses,
whether paid or not, and income earned, whether collected or
not.
Accrual Basis Accounting
ANSWER-reporting income when it is earned and expenses
when they are incurred
Accrual Basis Accounting
ANSWER-the method of accounting that recognizes revenue
when it is earned and matches expenses to the revenues they
helped produce
Accrual Basis Accounting
ANSWER-Accounting basis in which companies record, in the
periods in which the events occur, transactions that change a
ANSWER-company's financial statements, even if cash was not
exchanged.
, accrued expenses
ANSWER-expenses incurred in one fiscal period but not paid
until a later fiscal period
accrued expenses
ANSWER-expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities
ANSWER-The net amount of cash provided from operating
activities.
cash flow from financing activities
ANSWER-The idea of matching over time
WITH COMPLETE QUESTIONS AND DETAILED ANSWERS
ALREADY A+ GRADED
Income statement accounting
ANSWER-Accrual - revenues & costs recorded as a business
earns or incurs them, not as it receives and pays money
It includes them in the relevant period's income statement and
matches them as closely as possible
CF makes no difference whatsoever - IS where sale happens
=> How do you decide when sale happens? RECOGNIZE REV
UPON DELIVERY OF GOOD/SERVICE PERFORMED
Why are profits and cash flow not the same thing?
ANSWER-Accounting differences
The idea of matching over time
,ANSWER-CFS Accounting
Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method
ANSWER-record income and expenditures at the time the
money changes hands
Cash accounting method
ANSWER-An accounting method in which income and
expenditures are recorded at the time the money changes
hands.
Accrual Accounting
,ANSWER-recording in each fiscal period applicable expenses,
whether paid or not, and income earned, whether collected or
not.
Accrual Basis Accounting
ANSWER-reporting income when it is earned and expenses
when they are incurred
Accrual Basis Accounting
ANSWER-the method of accounting that recognizes revenue
when it is earned and matches expenses to the revenues they
helped produce
Accrual Basis Accounting
ANSWER-Accounting basis in which companies record, in the
periods in which the events occur, transactions that change a
ANSWER-company's financial statements, even if cash was not
exchanged.
, accrued expenses
ANSWER-expenses incurred in one fiscal period but not paid
until a later fiscal period
accrued expenses
ANSWER-expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities
ANSWER-The net amount of cash provided from operating
activities.
cash flow from financing activities
ANSWER-The idea of matching over time
