A100 EXAM QUESTIONS AND ANSWERS
GRADED A+ 2026
Financial accounting - ANS the records and reports available to people outside of a company
3 type of business activity - ANS 1) financing
2) investing
3) operating
ways equity investor makes money on investment: - ANS 1) receiving dividends from the
company
2) selling their stock when price increased
maturity date - ANS the date by which the loan is to be repaid
collateral - ANS assets that are pledged by the borrower to the creditor if the borrower is not
able to repay the item
equity vs debt investors - ANS equity- become owner of company. will benefit if the company
is successful
debt- will be repaid for sure (principal and interest but do not participate)
@COPYRIGHT 2026/2027 ALL RIGHTS RESERVED
1
, fixed assets - ANS land buildings equipment
1) likely to last a number of years
2)expected to be used in operations of the business and not sold (inventory)
operating activity - ANS what is neither financing nor investing
transactions related to running the business and marketing the company's product
Ex: salaries and wages, rent, utilities, insurance, purchase of goods to be resold
Leftover cash? options after debt is paid - ANS 1) invest in more fixed assets
2) pay dividends
3) save cash for future
Securities and Exchange Commission - ANS backlash to 1929 crash
maintains "fair and truthful capital markets"
only publicly-held corporations
form 10K - ANS Annually
audited financial report
form 10Q - ANS quarterly
unaudited financial reports covering most recent quarter
annual report - ANS -required by SEC
- outside independent auditor
Four standard financial statements
Four financial statements: - ANS 1) balance sheet
@COPYRIGHT 2026/2027 ALL RIGHTS RESERVED
2
GRADED A+ 2026
Financial accounting - ANS the records and reports available to people outside of a company
3 type of business activity - ANS 1) financing
2) investing
3) operating
ways equity investor makes money on investment: - ANS 1) receiving dividends from the
company
2) selling their stock when price increased
maturity date - ANS the date by which the loan is to be repaid
collateral - ANS assets that are pledged by the borrower to the creditor if the borrower is not
able to repay the item
equity vs debt investors - ANS equity- become owner of company. will benefit if the company
is successful
debt- will be repaid for sure (principal and interest but do not participate)
@COPYRIGHT 2026/2027 ALL RIGHTS RESERVED
1
, fixed assets - ANS land buildings equipment
1) likely to last a number of years
2)expected to be used in operations of the business and not sold (inventory)
operating activity - ANS what is neither financing nor investing
transactions related to running the business and marketing the company's product
Ex: salaries and wages, rent, utilities, insurance, purchase of goods to be resold
Leftover cash? options after debt is paid - ANS 1) invest in more fixed assets
2) pay dividends
3) save cash for future
Securities and Exchange Commission - ANS backlash to 1929 crash
maintains "fair and truthful capital markets"
only publicly-held corporations
form 10K - ANS Annually
audited financial report
form 10Q - ANS quarterly
unaudited financial reports covering most recent quarter
annual report - ANS -required by SEC
- outside independent auditor
Four standard financial statements
Four financial statements: - ANS 1) balance sheet
@COPYRIGHT 2026/2027 ALL RIGHTS RESERVED
2
