Comprehensive Financial
Accounting Terms &
Principles 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
,What are Assets? Future Economic Benefits (what the company has)
What are Liabilities? Sacrifices of Economic Benefits (what the company owes)
What is Equity? Assets - Liabilities = Equity; what the company owns
What is Materiality? Significant enough to make a difference
What does Immaterial mean? Not significant; amount wouldn't make a difference in a decision
What are Revenues? Providing goods and services to customers; increases NI
What are Expenses? Used up benefits; decreases NI
What is Comprehensive Income? NI + OCI = CI
What does CI stand for? Comprehensive Income
What does AOCI stand for? Accumulated Other Comprehensive Income
What type of account is AOCI? Equity Account
What is OCI? Current period changes in AOCI
, What are the OCI buzz words? Foreign, Pension, Unrealized Gain/Loss - AFS
What is the Equity Account Formula? BB Account +/- Activity = EB Account
What does BB mean? Beginning Balance
What does EB mean? Ending Balance
What is the Historical Cost Measurement Principle? Amount that something was purchased for; usually can be verified on a receipt or
invoice (business receipt); historical cost does not change
What are the synonyms for Historical Cost? Cost, HC, Purchase Price
What does HC stand for? Historical Cost
What is the Fair Value Measurement Principle? What something is worth on the fair market TODAY; this amount fluctuates
What are the synonyms for Fair Value? Fair Market Value, Market Value, FMV
What does FMV stand for? Fair Market Value
At what point will HC = FMV? At the date of the purchase
What is the Revenue Recognition Principle? Recognize revenues in period when goods & services are provided
Accounting Terms &
Principles 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
,What are Assets? Future Economic Benefits (what the company has)
What are Liabilities? Sacrifices of Economic Benefits (what the company owes)
What is Equity? Assets - Liabilities = Equity; what the company owns
What is Materiality? Significant enough to make a difference
What does Immaterial mean? Not significant; amount wouldn't make a difference in a decision
What are Revenues? Providing goods and services to customers; increases NI
What are Expenses? Used up benefits; decreases NI
What is Comprehensive Income? NI + OCI = CI
What does CI stand for? Comprehensive Income
What does AOCI stand for? Accumulated Other Comprehensive Income
What type of account is AOCI? Equity Account
What is OCI? Current period changes in AOCI
, What are the OCI buzz words? Foreign, Pension, Unrealized Gain/Loss - AFS
What is the Equity Account Formula? BB Account +/- Activity = EB Account
What does BB mean? Beginning Balance
What does EB mean? Ending Balance
What is the Historical Cost Measurement Principle? Amount that something was purchased for; usually can be verified on a receipt or
invoice (business receipt); historical cost does not change
What are the synonyms for Historical Cost? Cost, HC, Purchase Price
What does HC stand for? Historical Cost
What is the Fair Value Measurement Principle? What something is worth on the fair market TODAY; this amount fluctuates
What are the synonyms for Fair Value? Fair Market Value, Market Value, FMV
What does FMV stand for? Fair Market Value
At what point will HC = FMV? At the date of the purchase
What is the Revenue Recognition Principle? Recognize revenues in period when goods & services are provided
