CCIFP ACCOUNTING AND REPORTING
EXAM QUESTIONS AND ANSWERS 2026
VERIFIED.
Current Ratio - ANS Current Assets/Current Liabilities
Return on Equity - ANS Net Income/Total Net Worth (or Total Stockholders Equity)
Return on Assets - ANS Net Income/Total Assets
Debt to Equity Ratio - ANS Total Liabilities/Stockholders Equity
Asset Turnover Ratio - ANS Net Sales/Total Assets
Days in Accounts Receivable (AR) - ANS (Accounts Receivable/Total Credit Sales) x Number of
Days
Return on Sales - ANS Operating Profit (EBIT)/Revenue
Months Revenue in Backlog - ANS Backlog Gross Revenue/(Annual Revenue/12)
@2026/2027 ALLRIGHTS RESERVED.
,What are assets constructed and intended for sale or lease? - ANS Qualifying assets that
warrant capitalization of interest.
Statement of Position on Scope applies to _________? - ANS Accounting for performance
contracts for which specifications are provided by the customer for the construction of facilities
or the production of goods or the provisions of related services that are reported in financial
statements prepared in conformity with generally accepted accounting principles.
Working Capital Turnover - ANS Gross Revenue/(Current Assets - Current Liabilities)
Fixed Asset Turnover Ratio - ANS Net Sales/Average Net Fixed Assets
What are two (2) accepted methods of accounting - reporting for construction? - ANS 1) POC
- Percentage of Completion Method 2) CCM - Completed Contract Method
Cost Recovery - ANS The recovery of specific costs (identified in the construction contract)
throughout the life of a project.
3 Risks Addressed with Internal Controls - ANS Financial Reporting, Regulatory Compliance,
Operations
What is the zero gross profit option for the completed contract method? - ANS Recognizes
revenue and cost for the period, but zero gross profit allows company to show costs for the
period.
Why do Accountants use GAAP? - ANS Accountants adhere to GAAP for consistency, fairness,
honesty and accuracy in measuring and disclosing financial information.
What is financial reporting 4 components? - ANS Financial reporting includes the following:
the external financial statements (balance sheet, income statement, statement of cash flows
and statement of stockholders.
@2026/2027 ALLRIGHTS RESERVED.
, When accounting for losses, what is recommended method of recording? - ANS Should be as
additional costs not reduction of revenue
Gross Profit - ANS Gross Profit is net sales minus the cost of goods sold. (Sometimes referred
to as GP or (GM) Gross margin.
Three objectives of Financial Managers - ANS 1) Profitability 2)Liquidity 3) Financial Reporting
Job Profitability - ANS The financial manager should ensure that margins on jobs are
maximized through cost recovery.
Monetary Unit Assumption - ANS Part of the "Monetary" unit assumption is that the U.S.
dollar retains its purchasing power over time
Matching Principle - ANS Adjusting entries help to achieve the "Matching" principle.
Original Cost Principle - ANS Under US GAAP, most assets are held at their original costs (less
depreciation or impairment) as opposed to fair value.
Industry Practice - ANS Allows the format of public utility's balance sheet to be different from
that of a manufacturer.
Materiality - ANS Allows for the violation of the accounting principle when the amounts are
insignificant.
What is ABC? - ANS Activity-Based Costing 1) Links indirect costs to activities 2)Allocates
"activity" cost to jobs based on specific attributes
Economic - ANS The entity assumptions results in business transactions being kept separate
from a sole proprietor's.
@2026/2027 ALLRIGHTS RESERVED.
EXAM QUESTIONS AND ANSWERS 2026
VERIFIED.
Current Ratio - ANS Current Assets/Current Liabilities
Return on Equity - ANS Net Income/Total Net Worth (or Total Stockholders Equity)
Return on Assets - ANS Net Income/Total Assets
Debt to Equity Ratio - ANS Total Liabilities/Stockholders Equity
Asset Turnover Ratio - ANS Net Sales/Total Assets
Days in Accounts Receivable (AR) - ANS (Accounts Receivable/Total Credit Sales) x Number of
Days
Return on Sales - ANS Operating Profit (EBIT)/Revenue
Months Revenue in Backlog - ANS Backlog Gross Revenue/(Annual Revenue/12)
@2026/2027 ALLRIGHTS RESERVED.
,What are assets constructed and intended for sale or lease? - ANS Qualifying assets that
warrant capitalization of interest.
Statement of Position on Scope applies to _________? - ANS Accounting for performance
contracts for which specifications are provided by the customer for the construction of facilities
or the production of goods or the provisions of related services that are reported in financial
statements prepared in conformity with generally accepted accounting principles.
Working Capital Turnover - ANS Gross Revenue/(Current Assets - Current Liabilities)
Fixed Asset Turnover Ratio - ANS Net Sales/Average Net Fixed Assets
What are two (2) accepted methods of accounting - reporting for construction? - ANS 1) POC
- Percentage of Completion Method 2) CCM - Completed Contract Method
Cost Recovery - ANS The recovery of specific costs (identified in the construction contract)
throughout the life of a project.
3 Risks Addressed with Internal Controls - ANS Financial Reporting, Regulatory Compliance,
Operations
What is the zero gross profit option for the completed contract method? - ANS Recognizes
revenue and cost for the period, but zero gross profit allows company to show costs for the
period.
Why do Accountants use GAAP? - ANS Accountants adhere to GAAP for consistency, fairness,
honesty and accuracy in measuring and disclosing financial information.
What is financial reporting 4 components? - ANS Financial reporting includes the following:
the external financial statements (balance sheet, income statement, statement of cash flows
and statement of stockholders.
@2026/2027 ALLRIGHTS RESERVED.
, When accounting for losses, what is recommended method of recording? - ANS Should be as
additional costs not reduction of revenue
Gross Profit - ANS Gross Profit is net sales minus the cost of goods sold. (Sometimes referred
to as GP or (GM) Gross margin.
Three objectives of Financial Managers - ANS 1) Profitability 2)Liquidity 3) Financial Reporting
Job Profitability - ANS The financial manager should ensure that margins on jobs are
maximized through cost recovery.
Monetary Unit Assumption - ANS Part of the "Monetary" unit assumption is that the U.S.
dollar retains its purchasing power over time
Matching Principle - ANS Adjusting entries help to achieve the "Matching" principle.
Original Cost Principle - ANS Under US GAAP, most assets are held at their original costs (less
depreciation or impairment) as opposed to fair value.
Industry Practice - ANS Allows the format of public utility's balance sheet to be different from
that of a manufacturer.
Materiality - ANS Allows for the violation of the accounting principle when the amounts are
insignificant.
What is ABC? - ANS Activity-Based Costing 1) Links indirect costs to activities 2)Allocates
"activity" cost to jobs based on specific attributes
Economic - ANS The entity assumptions results in business transactions being kept separate
from a sole proprietor's.
@2026/2027 ALLRIGHTS RESERVED.
