ACCOUNTING CRASH COURSE EXAM V4
2026 COMPREHENSIVE FINANCIAL
ACCOUNTING CRASH COURSE REVIEW AND
PRACTICE QUESTION SET
◉ How was the AICPA created.
Answer: 1. Established the committee of accounting procedure
(*CAP*)
2. Accounting principles board (*APB*)
3. Financial Accounting and standards Board (*FASB*)
◉ Financial Accounting Standards Board (FASB).
Answer: -Major organization of the *standard-setting structure for
financial accounting*
-Wants to establish and improve standards of financial accounting
and reporting for the guidance and education of the public
-Accounting guidance issued by FASB is considered GAAP
-Issues: Accounting standards updates & financial accounting
concepts
◉ Generally Accepted Accounting Principles (GAAP).
,Answer: *common set of accounting standards and procedures* for
which either an authoritative accounting rule making body has
established a principle of reporting in a given area, or over time, a
given practice has been accepted as appropriate because of its
*universal application*
◉ FASB Codification.
Answer: -Provides all the authoritative literature related to a
particular topic in one place
-Topic → subtopics → sections → paragraphs
◉ Major Challenges in Financial Reporting.
Answer: GAAP is as much a product of *political action* as it is of
*careful logic* or empirical findings
◉ Measurement Principle.
Answer: - *Historical cost* (maintain same value originally
assigned)
- *Fair value* (estimate of the potential price)
◉ Revenue Recognition Principle.
Answer: Requires companies recognize revenue in the *period*
performance *obligation is satisfied*.
, ◉ Expense Recognition Principle.
Answer: Expenses follows the revenues.
◉ Full Disclosure Principle.
Answer: Providing information that is of *sufficient importance to
influence and inform the judgement and decisions of an informed
user* (financial statements, notes to the statements, supplementary
information).
◉ Two Perspectives of Time.
Answer: 1. Date (point in time): *"as of"*; balance sheet
2. Time between two dates (period): *"for the year ended"*; income
statement, cash flow
◉ DEAD CRLS.
Answer: *Debits* INCREASE
*E*xpenses
*A*ssets
*D*ividends declared
*Credits* INCREASE
*R*evenues
*L*iabilities
2026 COMPREHENSIVE FINANCIAL
ACCOUNTING CRASH COURSE REVIEW AND
PRACTICE QUESTION SET
◉ How was the AICPA created.
Answer: 1. Established the committee of accounting procedure
(*CAP*)
2. Accounting principles board (*APB*)
3. Financial Accounting and standards Board (*FASB*)
◉ Financial Accounting Standards Board (FASB).
Answer: -Major organization of the *standard-setting structure for
financial accounting*
-Wants to establish and improve standards of financial accounting
and reporting for the guidance and education of the public
-Accounting guidance issued by FASB is considered GAAP
-Issues: Accounting standards updates & financial accounting
concepts
◉ Generally Accepted Accounting Principles (GAAP).
,Answer: *common set of accounting standards and procedures* for
which either an authoritative accounting rule making body has
established a principle of reporting in a given area, or over time, a
given practice has been accepted as appropriate because of its
*universal application*
◉ FASB Codification.
Answer: -Provides all the authoritative literature related to a
particular topic in one place
-Topic → subtopics → sections → paragraphs
◉ Major Challenges in Financial Reporting.
Answer: GAAP is as much a product of *political action* as it is of
*careful logic* or empirical findings
◉ Measurement Principle.
Answer: - *Historical cost* (maintain same value originally
assigned)
- *Fair value* (estimate of the potential price)
◉ Revenue Recognition Principle.
Answer: Requires companies recognize revenue in the *period*
performance *obligation is satisfied*.
, ◉ Expense Recognition Principle.
Answer: Expenses follows the revenues.
◉ Full Disclosure Principle.
Answer: Providing information that is of *sufficient importance to
influence and inform the judgement and decisions of an informed
user* (financial statements, notes to the statements, supplementary
information).
◉ Two Perspectives of Time.
Answer: 1. Date (point in time): *"as of"*; balance sheet
2. Time between two dates (period): *"for the year ended"*; income
statement, cash flow
◉ DEAD CRLS.
Answer: *Debits* INCREASE
*E*xpenses
*A*ssets
*D*ividends declared
*Credits* INCREASE
*R*evenues
*L*iabilities
