WGU D102 FINANCIAL ACCOUNTING
OA STUDY GUIDE
,Table of Contents
Unit 2 - The Primary Financial Statement................................................................................ 4
Module 1 - The Balance Sheet.............................................................................................................. 4
Lesson 1 - Assets, Liabilities & Owners Equity ..................................................................................................4
Lesson 2 - The Accounting Equation .................................................................................................................. 5
Lesson 3 - The Elements of the Balance Sheet ................................................................................................... 5
Lesson 4 - Revenues & Expenses ..................................................................................................................... 10
Lesson 5 - Organization of Income Statement ................................................................................................ 11
Lesson 6 - Net Income & Earnings per Share .................................................................................................. 12
Module 3- The Statement of Cash Flows ......................................................................................... 13
Lesson 7 - Activities of Cash Flow.................................................................................................................... 13
Lesson 8 - Sources & Uses of Cash Flow .......................................................................................................... 14
Lesson 9 - How Financial Statements Tie Together ....................................................................................... 14
Unit 3 - Accounting Cycle Mechanics ....................................................................................... 16
Module 4 - The Accounting Equation .............................................................................................. 16
Lesson 10 - T Accounts, Debits, & Credits ........................................................................................................16
Lesson 11 - Transactions & the Balance Sheets.............................................................................................. 19
Lesson 12 - Transactions & the Income Statement ........................................................................................ 19
Module 5 - Recording Accounting Transactions ........................................................................... 20
Lesson 13 - The Difference Between Journals & Ledgers .............................................................................. 20
Lesson 14 - How are Journal Entries Used? .................................................................................................... 20
Lesson 15 - Creating Journal Entries ............................................................................................................... 20
Lesson 16 - Chart of Accounts .......................................................................................................................... 21
Unit 4 - Completing the Accounting Cycle ............................................................................... 23
Module 6 - Adjusting Journal Entries .............................................................................................. 23
Lesson 17 - Revenue Recognition Principle .................................................................................................... 23
Lesson 18 - Matching Principle ........................................................................................................................ 24
Lesson19 - Accrual vs Cash Basis Accounting ................................................................................................. 24
Lesson 20 - Creating Adjusting Journal Entries .............................................................................................. 24
Module 7 - Closing the Income Statement ...................................................................................... 29
Lesson 21 - Real vs Nominal General Ledger Accounts ................................................................................. 29
Lesson 22 - Closing Entries .............................................................................................................................. 29
Lesson 23 - Post Closing Trial Balance ............................................................................................................ 32
Lesson 24 - Using Spreadsheets........................................................................................................................32
. ..................................................................................................................................................... 34
Unit 5 - Internal Controls .......................................................................................................... 35
Module 8 - Internal Controls ............................................................................................................. 35
Lesson 25 - Error Types ................................................................................................................................... 35
, Lesson 26 - Important Internal Controls......................................................................................................... 35
Lesson 27 -Business Controls .......................................................................................................................... 37
Lesson 28 - Reconciling Bank Accounts .......................................................................................................... 37
Unit 6 - Receivables: Selling a Product .................................................................................... 40
Module 9 - Receivables ...................................................................................................................... 40
Lesson 29 - Sales Discounts, Returns & Allowances....................................................................................... 40
Lesson 30 - Allowance Estimation Methods ................................................................................................... 42
Unit 7 - Inventory & Cost of Goods ........................................................................................... 45
Module 10 - Inventory Related Transactions ................................................................................ 45
Lesson 31 - Inventory Costs ............................................................................................................................. 45
Lesson 32 - Purchases Discounts, Returns & Allowances .............................................................................. 47
Module 11 - Inventory Cost Flow Assumptions ............................................................................. 49
Lesson 33 - Physical Inventory Count ............................................................................................................. 49
Lesson 34 - Inventory Cost Flow ..................................................................................................................... 50
Unit 8 - Investing & Accounting for Property, Plants, Equipment (PPE) & Intangible
Assets............................................................................................................................................ 51
Module 12 - Acquisitions, Depreciations & Disposal of Property, Plant & Equipment (PPE)
................................................................................................................................................................ 51
Lesson 35 - Capitalizing vs. Expensing ............................................................................................................ 51
Lesson 36 - Straight-Line Method.................................................................................................................... 51
Lesson 37 - Accelerated Depreciation Methods ............................................................................................. 52
Lesson 38 - Recording Gains/Losses for Disposed PPE ................................................................................. 55
Module 13 - Acquisitions & Amortization of Intangible Assets .................................................. 57
Lesson 39 - Trademarks ................................................................................................................................... 57
Lesson 40 - Patents ........................................................................................................................................... 58
Lesson 41 – Franchise ...................................................................................................................................... 58
Lesson 42 - Amortization Expense .................................................................................................................. 58
Unit 9 - Completing the Operating Cycle................................................................................. 58
Module 14 - Accounting for Current Liabilities ............................................................................. 59
Lesson 43 - Payroll - Related Expenses & Withholdings ................................................................................ 59
Lesson 44 - Compensated Absences ................................................................................................................ 60
Lesson 45 - Sales Taxes & Property Taxes ...................................................................................................... 61
Lesson 46 -Contingencies ................................................................................................................................. 61
Module 15 - Long-Term Liabilities .................................................................................................. 62
Lesson 47 - Present & Future Value ................................................................................................................ 62
Lesson 48 - Notes Payable & Mortgages ......................................................................................................... 62
Module 16 - Accounting for Equity Transactions .......................................................................... 62
Lesson 49 - Common & Preferred Stock.......................................................................................................... 62
Lesson 50 - Retained Earnings......................................................................................................................... 63
Lesson 51 - Cash Dividends.............................................................................................................................. 64
,
OA STUDY GUIDE
,Table of Contents
Unit 2 - The Primary Financial Statement................................................................................ 4
Module 1 - The Balance Sheet.............................................................................................................. 4
Lesson 1 - Assets, Liabilities & Owners Equity ..................................................................................................4
Lesson 2 - The Accounting Equation .................................................................................................................. 5
Lesson 3 - The Elements of the Balance Sheet ................................................................................................... 5
Lesson 4 - Revenues & Expenses ..................................................................................................................... 10
Lesson 5 - Organization of Income Statement ................................................................................................ 11
Lesson 6 - Net Income & Earnings per Share .................................................................................................. 12
Module 3- The Statement of Cash Flows ......................................................................................... 13
Lesson 7 - Activities of Cash Flow.................................................................................................................... 13
Lesson 8 - Sources & Uses of Cash Flow .......................................................................................................... 14
Lesson 9 - How Financial Statements Tie Together ....................................................................................... 14
Unit 3 - Accounting Cycle Mechanics ....................................................................................... 16
Module 4 - The Accounting Equation .............................................................................................. 16
Lesson 10 - T Accounts, Debits, & Credits ........................................................................................................16
Lesson 11 - Transactions & the Balance Sheets.............................................................................................. 19
Lesson 12 - Transactions & the Income Statement ........................................................................................ 19
Module 5 - Recording Accounting Transactions ........................................................................... 20
Lesson 13 - The Difference Between Journals & Ledgers .............................................................................. 20
Lesson 14 - How are Journal Entries Used? .................................................................................................... 20
Lesson 15 - Creating Journal Entries ............................................................................................................... 20
Lesson 16 - Chart of Accounts .......................................................................................................................... 21
Unit 4 - Completing the Accounting Cycle ............................................................................... 23
Module 6 - Adjusting Journal Entries .............................................................................................. 23
Lesson 17 - Revenue Recognition Principle .................................................................................................... 23
Lesson 18 - Matching Principle ........................................................................................................................ 24
Lesson19 - Accrual vs Cash Basis Accounting ................................................................................................. 24
Lesson 20 - Creating Adjusting Journal Entries .............................................................................................. 24
Module 7 - Closing the Income Statement ...................................................................................... 29
Lesson 21 - Real vs Nominal General Ledger Accounts ................................................................................. 29
Lesson 22 - Closing Entries .............................................................................................................................. 29
Lesson 23 - Post Closing Trial Balance ............................................................................................................ 32
Lesson 24 - Using Spreadsheets........................................................................................................................32
. ..................................................................................................................................................... 34
Unit 5 - Internal Controls .......................................................................................................... 35
Module 8 - Internal Controls ............................................................................................................. 35
Lesson 25 - Error Types ................................................................................................................................... 35
, Lesson 26 - Important Internal Controls......................................................................................................... 35
Lesson 27 -Business Controls .......................................................................................................................... 37
Lesson 28 - Reconciling Bank Accounts .......................................................................................................... 37
Unit 6 - Receivables: Selling a Product .................................................................................... 40
Module 9 - Receivables ...................................................................................................................... 40
Lesson 29 - Sales Discounts, Returns & Allowances....................................................................................... 40
Lesson 30 - Allowance Estimation Methods ................................................................................................... 42
Unit 7 - Inventory & Cost of Goods ........................................................................................... 45
Module 10 - Inventory Related Transactions ................................................................................ 45
Lesson 31 - Inventory Costs ............................................................................................................................. 45
Lesson 32 - Purchases Discounts, Returns & Allowances .............................................................................. 47
Module 11 - Inventory Cost Flow Assumptions ............................................................................. 49
Lesson 33 - Physical Inventory Count ............................................................................................................. 49
Lesson 34 - Inventory Cost Flow ..................................................................................................................... 50
Unit 8 - Investing & Accounting for Property, Plants, Equipment (PPE) & Intangible
Assets............................................................................................................................................ 51
Module 12 - Acquisitions, Depreciations & Disposal of Property, Plant & Equipment (PPE)
................................................................................................................................................................ 51
Lesson 35 - Capitalizing vs. Expensing ............................................................................................................ 51
Lesson 36 - Straight-Line Method.................................................................................................................... 51
Lesson 37 - Accelerated Depreciation Methods ............................................................................................. 52
Lesson 38 - Recording Gains/Losses for Disposed PPE ................................................................................. 55
Module 13 - Acquisitions & Amortization of Intangible Assets .................................................. 57
Lesson 39 - Trademarks ................................................................................................................................... 57
Lesson 40 - Patents ........................................................................................................................................... 58
Lesson 41 – Franchise ...................................................................................................................................... 58
Lesson 42 - Amortization Expense .................................................................................................................. 58
Unit 9 - Completing the Operating Cycle................................................................................. 58
Module 14 - Accounting for Current Liabilities ............................................................................. 59
Lesson 43 - Payroll - Related Expenses & Withholdings ................................................................................ 59
Lesson 44 - Compensated Absences ................................................................................................................ 60
Lesson 45 - Sales Taxes & Property Taxes ...................................................................................................... 61
Lesson 46 -Contingencies ................................................................................................................................. 61
Module 15 - Long-Term Liabilities .................................................................................................. 62
Lesson 47 - Present & Future Value ................................................................................................................ 62
Lesson 48 - Notes Payable & Mortgages ......................................................................................................... 62
Module 16 - Accounting for Equity Transactions .......................................................................... 62
Lesson 49 - Common & Preferred Stock.......................................................................................................... 62
Lesson 50 - Retained Earnings......................................................................................................................... 63
Lesson 51 - Cash Dividends.............................................................................................................................. 64
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