Accounting 3312

Study Guide for Final Examination

Spring 2014
Chapter 13
1.
2.

Study accounting for contingencies. Know rules for gain and loss
contingencies. When do we accrue gains and losses? When do we have note
disclosure? See notes for Chapter 13
Study accounting for warranties. When do we account for warranty expense
under the accrual method? Under the cash method? Study the section on short
term obligations expected to be refinanced.
Chapter 14

1.

2.

Study accounting for the issuance of bonds. Under what conditions are bonds
issued at a premium? At a discount? Be able to compute interest expense
using the effective interest method or the straight line method. Be able to
account for the issuance of bonds between interest dates. See notes for
Chapter 14.
How do we account for bond issue costs? See notes for Chapter 14.
Chapter 15

1.
2.

Be able to account for the purchase and reissuance of treasury stock. Be able
to distinguish between cash dividends, property dividends, liquidating
dividends, and stock dividends. See notes for Chapter 15.
Know how to account for stock dividends and stock splits.
Chapter 16

1.
2.

Be able to compute basic and diluted earnings per share when we have
dilutive securities. Be able to account for convertible bonds and preferred
stock
Also, be able to convert bonds and preferred stock to common stock.
Chapter 17

1.

Be able to account for investments using the fair value method. Be able to
distinguish between trading and available for sale securities. Know the items
that go into computation of net income, comprehensive income, and other
comprehensive income (stockholders equity). Study accounting for
investments in stocks (equity securities) using the equity method.

Chapter 18
1.
2.

Be able to compute gross profit or loss under percentage of completion or

completed contract methods. Know the guidelines for using the cost- recovery
(zero-profit) method.
Be able to compute realized gross profit under the installment sales method
and the ending balance in deferred gross profit. Also, be able to determine
gain or loss from repossessions. See multiple choice questions-Ch 18
Chapter 19

1.

2.

Be able to compute income tax expense (current and deferred) when we have
temporary differences. Be able to compute the current and noncurrent balance
sheet amounts for deferred tax assets and deferred tax liabilities. No journal
entries will be required.
Be able to the tax benefits of a loss carryback and carryforward and the
amount of net loss shown on the income statement after these benefits. See
E19-23. No journal entries will be required.
Chapter 21

1.
2.
3.
4.

Know how to classify a lease as either a capital or operating.

Know journal entries of capital leases and be able to prepare a partial
amortization schedule.
Know what would appear in the balance sheet and the income statement for
capital and operating leases.
Study only lessee accounting. Your Special HW problem on leases and
Class Example 2 (Cases A, B. C and D) are good problems to study for
leases.
Chapter 22

1.

Know how to use the retrospective method for accounting change. Know how
to use the prospective method for changes in accounting estimates. Study
correction of errors.
Chapter 23

1.

Be able to prepare a formal cash flow statement using either indirect method
or the direct method which includes a reconciliation of net income to cash
provided from operations. You should be able to work with gain or loss
resulting from the sale of equipment, bad debt expense, write-offs of accounts
receivable, increase or decrease of deferred tax assets or liabilities, and the
issuance or payment of capital stock and debt. You should also be able to work

with noncash investing/financing activities. Problem 23-8 and your special

HW problem are good problems to review for the final.