CFI FMVA EXAM 2024-2025 QUESTIONS
WITH CORRECT ANSWERS
Income statement accounting - ✔✔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? - ✔✔Accounting differences
The idea of matching over time - ✔✔
CFS Accounting - ✔✔Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method - ✔✔record income and expenditures at the time the money changes hands
Cash accounting method - ✔✔An accounting method in which income and expenditures are recorded
at the time the money changes hands.
Accrual Accounting - ✔✔recording in each fiscal period applicable expenses, whether paid or not, and
income earned, whether collected or not.
Accrual Basis Accounting - ✔✔reporting income when it is earned and expenses when they are
incurred
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
,Accrual Basis Accounting - ✔✔the method of accounting that recognizes revenue when it is earned
and matches expenses to the revenues they helped produce
Accrual Basis Accounting - ✔✔Accounting basis in which companies record, in the periods in which
the events occur, transactions that change a company's financial statements, even if cash was not
exchanged.
accrued expenses - ✔✔expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses - ✔✔expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities - ✔✔The net amount of cash provided from operating activities.
cash flow from financing activities - ✔✔
The idea of matching over time - ✔✔
CFS Accounting - ✔✔Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method - ✔✔record income and expenditures at the time the money changes hands
Cash accounting method - ✔✔An accounting method in which income and expenditures are recorded
at the time the money changes hands.
Accrual Accounting - ✔✔recording in each fiscal period applicable expenses, whether paid or not, and
income earned, whether collected or not.
Accrual Basis Accounting - ✔✔reporting income when it is earned and expenses when they are
incurred
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
,Accrual Basis Accounting - ✔✔the method of accounting that recognizes revenue when it is earned
and matches expenses to the revenues they helped produce
Accrual Basis Accounting - ✔✔Accounting basis in which companies record, in the periods in which
the events occur, transactions that change a company's financial statements, even if cash was not
exchanged.
accrued expenses - ✔✔expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses - ✔✔expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities - ✔✔The net amount of cash provided from operating activities.
cash flow from financing activities - ✔✔The section of the statement of cash flows that reports cash
flows from transactions affecting the equity and debt of the business.
cash flow from financing activities - ✔✔items related to debt, dividends, and issuing or repurchasing
shares
cash flow from investing activities - ✔✔The section of the statement of cash flows that reports cash
flows from transactions affecting investments in noncurrent assets.
cash flow from investing activities - ✔✔involves any cash in or out of the company due to investment
in or disposal of fixed assets.
Contributed surplus - ✔✔Amount paid for shares in excess of their par value
Contributed surplus - ✔✔money that has been invested in the firm by outside parties
Contributed surplus - ✔✔A source of contributed capital that can result from certain types of equity
transactions, including the reacquisition of shares.
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
, Straightline depreciation - ✔✔Allocates equal amounts of plant assets net cost to depreciation during
its useful life.
Accounts Receivable - ✔✔Amounts to be received in the future due to the sale of goods or services
Accounts Payable - ✔✔Amounts to be paid in the future for goods or services already acquired
Cash Flow Accounting System - ✔✔An accounting system entering expenses and revenues only when
cash is received or paid out.
authorised share capital - ✔✔Maximum number of shares that a company can issue, as specified in
the firm's memorandum of association
outstanding share capital - ✔✔Issued share capital less the par value of shares that are held in the
company's treasury.
inventory - ✔✔the quantity of goods that a firm has on hand
inventory - ✔✔a complete list of items such as property, goods in stock, or the contents of a building.
Working Capital - ✔✔current assets - current liabilities
Net Working Capital - ✔✔current assets minus current liabilities
current assets - ✔✔cash and other assets expected to be exchanged for cash or consumed within a
year
Current Liabilities - ✔✔liabilities due within a short time, usually within a year
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
WITH CORRECT ANSWERS
Income statement accounting - ✔✔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? - ✔✔Accounting differences
The idea of matching over time - ✔✔
CFS Accounting - ✔✔Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method - ✔✔record income and expenditures at the time the money changes hands
Cash accounting method - ✔✔An accounting method in which income and expenditures are recorded
at the time the money changes hands.
Accrual Accounting - ✔✔recording in each fiscal period applicable expenses, whether paid or not, and
income earned, whether collected or not.
Accrual Basis Accounting - ✔✔reporting income when it is earned and expenses when they are
incurred
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
,Accrual Basis Accounting - ✔✔the method of accounting that recognizes revenue when it is earned
and matches expenses to the revenues they helped produce
Accrual Basis Accounting - ✔✔Accounting basis in which companies record, in the periods in which
the events occur, transactions that change a company's financial statements, even if cash was not
exchanged.
accrued expenses - ✔✔expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses - ✔✔expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities - ✔✔The net amount of cash provided from operating activities.
cash flow from financing activities - ✔✔
The idea of matching over time - ✔✔
CFS Accounting - ✔✔Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method - ✔✔record income and expenditures at the time the money changes hands
Cash accounting method - ✔✔An accounting method in which income and expenditures are recorded
at the time the money changes hands.
Accrual Accounting - ✔✔recording in each fiscal period applicable expenses, whether paid or not, and
income earned, whether collected or not.
Accrual Basis Accounting - ✔✔reporting income when it is earned and expenses when they are
incurred
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
,Accrual Basis Accounting - ✔✔the method of accounting that recognizes revenue when it is earned
and matches expenses to the revenues they helped produce
Accrual Basis Accounting - ✔✔Accounting basis in which companies record, in the periods in which
the events occur, transactions that change a company's financial statements, even if cash was not
exchanged.
accrued expenses - ✔✔expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses - ✔✔expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities - ✔✔The net amount of cash provided from operating activities.
cash flow from financing activities - ✔✔The section of the statement of cash flows that reports cash
flows from transactions affecting the equity and debt of the business.
cash flow from financing activities - ✔✔items related to debt, dividends, and issuing or repurchasing
shares
cash flow from investing activities - ✔✔The section of the statement of cash flows that reports cash
flows from transactions affecting investments in noncurrent assets.
cash flow from investing activities - ✔✔involves any cash in or out of the company due to investment
in or disposal of fixed assets.
Contributed surplus - ✔✔Amount paid for shares in excess of their par value
Contributed surplus - ✔✔money that has been invested in the firm by outside parties
Contributed surplus - ✔✔A source of contributed capital that can result from certain types of equity
transactions, including the reacquisition of shares.
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
, Straightline depreciation - ✔✔Allocates equal amounts of plant assets net cost to depreciation during
its useful life.
Accounts Receivable - ✔✔Amounts to be received in the future due to the sale of goods or services
Accounts Payable - ✔✔Amounts to be paid in the future for goods or services already acquired
Cash Flow Accounting System - ✔✔An accounting system entering expenses and revenues only when
cash is received or paid out.
authorised share capital - ✔✔Maximum number of shares that a company can issue, as specified in
the firm's memorandum of association
outstanding share capital - ✔✔Issued share capital less the par value of shares that are held in the
company's treasury.
inventory - ✔✔the quantity of goods that a firm has on hand
inventory - ✔✔a complete list of items such as property, goods in stock, or the contents of a building.
Working Capital - ✔✔current assets - current liabilities
Net Working Capital - ✔✔current assets minus current liabilities
current assets - ✔✔cash and other assets expected to be exchanged for cash or consumed within a
year
Current Liabilities - ✔✔liabilities due within a short time, usually within a year
CFI FMVA EXAM 2024-2025 QUESTIONS WITH CORRECT ANSWERS
