Accounting 2026 | Study
Guide, Practice Questions,
Answers, Rationales &
Exam Review | Complete
Ethics Study Guide
Updated 2026 Questions and Answers
100% Verified Exam Prep and Comprehensive
Rationales
Included
, Assets Things company owns & uses to generate revenue
Liabilities Amount that company owes
Equity Amount invested in company by owners; owners claim no assets
Accounting equation Assets = liabilities + equity
Truism in business Company never receives greater than it gives & never gives greater than it receives
4 Rules of debits & credits 1. Debit amount received; credit amount given up
2. Debuts on left; credits on the right
3. In each transactions; list debits first (good) & credits last (bad)
4. Total debits = total credits
Making an ethical decision 1. Identify ethical concerns- use personal ethics to recognize concern
2. Analyze options- consider all good & bad consequences
3. Make ethical decision- choose best option given circumstances
Fraud Intentional manipulation- focus on prevention. Once fraud is committed, loses are
rarely retrieved.
Fraud Triangle Opportunity (low risk of being caught), Financial Pressure (incentive),
Rationalization (making situation justifiable)
GAAP (generally accepted accounting principles) Financial accounting is governed by concepts & rules.
1. Relevant info affects decision of user
2. Reliable info trusted by users
3. Comparable info aids in contrasting organizations
SEC- Securities and Exchange Commission Federal agency congress has charged to set reporting rules for org that sell
ownership shares to public
FASB (Financial Accounting Standards Board) Independent group of full-time members responsible for setting accounting rules
Guide, Practice Questions,
Answers, Rationales &
Exam Review | Complete
Ethics Study Guide
Updated 2026 Questions and Answers
100% Verified Exam Prep and Comprehensive
Rationales
Included
, Assets Things company owns & uses to generate revenue
Liabilities Amount that company owes
Equity Amount invested in company by owners; owners claim no assets
Accounting equation Assets = liabilities + equity
Truism in business Company never receives greater than it gives & never gives greater than it receives
4 Rules of debits & credits 1. Debit amount received; credit amount given up
2. Debuts on left; credits on the right
3. In each transactions; list debits first (good) & credits last (bad)
4. Total debits = total credits
Making an ethical decision 1. Identify ethical concerns- use personal ethics to recognize concern
2. Analyze options- consider all good & bad consequences
3. Make ethical decision- choose best option given circumstances
Fraud Intentional manipulation- focus on prevention. Once fraud is committed, loses are
rarely retrieved.
Fraud Triangle Opportunity (low risk of being caught), Financial Pressure (incentive),
Rationalization (making situation justifiable)
GAAP (generally accepted accounting principles) Financial accounting is governed by concepts & rules.
1. Relevant info affects decision of user
2. Reliable info trusted by users
3. Comparable info aids in contrasting organizations
SEC- Securities and Exchange Commission Federal agency congress has charged to set reporting rules for org that sell
ownership shares to public
FASB (Financial Accounting Standards Board) Independent group of full-time members responsible for setting accounting rules
