Final Study Guide
Final Study Guide BA 215
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This 11 page Study Guide was uploaded by Amy Notetaker on Wednesday September 2, 2015. The Study Guide belongs to BA 215 at University of Oregon taught by ? in Spring 2014. Since its upload, it has received 72 views. For similar materials see Accounting in Business Administration at University of Oregon.
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Date Created: 09/02/15
BA 215 Final Study Guide 03122014 1 Given a list of accounts calculate total assets 0 Cash 0 Accounts receivable Interest Receivable SuppliesPrepaid o Expenses Other Current Investments Investments long term 0 Property and Equipment Long term Accumulated Depreciation Subtract Notes Receivable Long term Intangibles Other Assets 2 Be able to write out the accounting equation 0 A L E 3 Know which nancial statement presents a summary of revenues and expenses 0 Income statement 4 Given assets and liabilities and the increases in assets and equity be able to calculate the change in liabilities A L E 5 Know how to record the transaction 39purchasing equipment on account39 FINAL EXAM STUDY GUIDE A L E Cash Equ Notes Pay 1700 8500 6800 Down payment1700 Equipment total price8500 Amount due ater6800 Know when expenses are reported and recorded under accrual accounting Expenses have been reported but not recorded until a later date Ex Wages are earned throughout the month but not recordedpaid until the end of the month 7 Know how to calculate the year end adjustment for supplies if given the beginning balance purchases and supplies left at year end 0 Beginning balance purchases supplies used supplies at end of year 8 Know what is subtracted from sales to get net sales 0 Net sales sales returns and discounts 9 Know how to calculate cost of merchandise sold if given beginning inventory purchases and ending inventory 0 Beginning inventory purchases merchandise sold ending inventory 10 0 Indirect method analyzes changes in accounts 0001 FINAL EXAM STUDY GUIDE 11 Know the purpose of the Sarbanes Oxley Act 0 Page 174 o The purpose of the SarbanesOxley is to restore public con dence and trust in the nancial reporting of companies 12 Know the objectives of internal control 0 1 Safe guard its assets 0 2 Process information accurately 3 Endure compliance with laws and regulations 14 Know how to calculate the adjustment to allowance for doubtful accounts using the of sales method 0 Of sales method Adjustment net sales x percentage of sales 15 Know how to calculate ending inventory using the FIFO method jan 15 for 2 0 Feb 10 for 3 FINAL EXAM STUDY GUIDE 0 July 10 for 4 0 End Inventory 9 items left 0 9 items left are 4 each because it was the last bought so it is the last to be soldleft in inventory Cost of Merchandise in Inventory 9x4 16 Know how to calculate depreciation expense using straight line method Depreciation Expense Depreciable Cost years of life 17 Know how to calculate depreciation expense for year one using the double declining balance method Depreciation Expense Cost Accum Depreciation x 2 x Straight Line 18 Know when contingent liabilities are required to be recorded Probable estimable 19 Know what solvency and pro tability are Pro tability the ability of a rm to earn income Solvency the ability of a rm to pay its debts as they come due 20 Know how to calculate the current ratio 0 Current ratio Current AssetsCurrent Liabilities 21 Know what costs are included in the cost of manufacturing a product aka product costs 0 Product cost COGS 0 Direct labor 0 Direct materials 0 Factory overhead Indirect materials Indirect labor FINAL EXAM STUDY GUIDE a Factory supervisors Other a Factory equipment depreciation a Factory rent a Factory insurance a Does not include any OFFICE expenses Officeadmin 22 Know what kind of costs are included in factory overhead 0 Factory overhead 0 Indirect materials 0 Indirect labor 0 Factory supervisors 0 Other Factory equipment depreciation Factory rent Factory insurance Does not include any OFFICE expenses Officeadmin 23 Know what kind of activity causes increases to the work in process account 0 Direct materials direct labor applied overhead 24 Know how to calculate applied factory overhead if given estimated total factory overhead costs and direct labor hours for the year and direct labor hours for a speci c job 0 Given Estimated total factory overhead estimated total direct labor hours number of direct labor hours for a speci c job 0 1 Calculate overhead allocation rate Overhead dollar per direct labor hour FINAL EXAM STUDY GUIDE 0 Estimated total factory overheadestimated total direct labor hours 0 2 Calculate applied overhead 0 Overhead allocation rate x number of direct labor hours for a job 25 Know how to record the transaction 39sale of a nished good on account39 0 A L E AR Finished Goods RE Sales Rev COGS 26 Know what period costs are and examples of them Nonproduct nonmanufacturing costs 0 Selling and admin costs 0 Examples 0 Selling sales people Advertising Sales people commission Sales people salaries Sales people hourly wage Shipping as a of sales 0 Administrative of ce Depreciation associated with of ce Of ce salaries Of ce supplies FINAL EXAM STUDY GUIDE Of ce hourly wage Insurance electricity for of ce 27 Know what types of inventories a manufacturing business have on its balance sheet 0 Materials 0 Work in process 0 Finished goods 28 Know what can cause differences in quantity of materials used between two identical orders in a manufacturing company 0 Employee competence 0 Employee training 0 Employee skill Quality of materials 0 Quality of equipment 29 Know what kind of costs remain constant on a per unit level as production changes 0 Variable costs remain constant on a PER UNIT level 30 Know what kind of costs in total vary in direct proportion to production changes 0 Total costs increases as production increases Variable costs 0 Total costs of xed costs remains the same as production increases 31 Know examples of costs that t the description in question 30 0 Variable costs hourly wage Fixed costs upfront payment 32 Know what happens to xed costs on a per unit basis when production increases FINAL EXAM STUDY GUIDE 0 Fixed costs will decrease on a per unit level as production increases 33 Be able to identify an example of a mixed cost 0 Has a xed component and a variable component 0 Ex 1000 plus 5 per labor hour etc 34 Be able to use the high low method to calculate variable costs on a per unit basis 0 Do not focus on cost choose based on production rate 0 1 Identify high and low quantities 0 High 2100 61500 Low 750 41250 2 Find the difference between high and low 21007501350 61500 4125020250 o Tells us range of production 0 3 20250 total cost difference 1350 unit difference Cost per unit 0 This is variable cost per unit 0 FOR TOTAL variable cost per unit x high units total variable cost on high 35 Be able to use the high low method to calculate total xed costs 0 Do not focus on cost choose based on production rate 0 1 Identify high and low quantities 0 High 2100 61500 Low 750 41250 2 Find the difference between high and low 21007501350 61500 4125020250 o Tells us range of production 0 3 20250 total cost difference 1350 unit difference Cost per unit 0 This is variable cost per unit FINAL EXAM STUDY GUIDE 0 FOR TOTAL VARIABLE COST variable cost per unit x high units total variable cost on high 0 4 Total costtotal variable costtota xed cost 36 Be able to calculate the break even units if given xed costs unit selling price and unit variable cost 0 Break even in units xed costsunit contribution margin 0 Unit contribution margin sales price per unit product cost per unit 37 Be able to calculate the break even units if given xed costs unit selling price and unit variable cost and calculate a new break even units if given selling price increase 0 Break even in units xed costsunit contribution margin 0 Unit contribution margin sales price per unit product cost per unit 38 Know what the difference between the current sales revenue and the sales at break even is called SalesSales at breakeven point margin of safety 39 Know what comparing the increase or decrease in costs between two alternative scenarios is called 0 Differential 40 Know what kind of cost is not affected by later decisions Sunk costs 41 Be able to calculate the net differential income between disposing of assets and leasing them out similar to presentation slides example 0 Differential income Discontinuing product line 0 To lease or to sell 0 Leasing price v selling price net differential is the difference in gain between the two options 42 Be able to calculate the change in income if a product line is discontinued similar to cereal example in presentation slides Revenue from sales Variable COGS Variable operating expense differential income FINAL EXAM STUDY GUIDE 43 Be able to calculate the differential cost increase or decrease from making a part rather than purchasing it similar to presentation slides example 0 Purchase price Direct materials Direct labor Variable factory overhead Cost savings 44 Know what is the most important factor to improving pro tability when there is a bottleneck UCMbottleneck hour 45 Be able to calculate selling expenses if given sales revenue sales commission sales manager salary advertising expenses shipping expenses as a of sales and misc selling expenses as a of sales plus a set amount 0 Selling expenses Sales salary expense advertising expense travel expense Add all of these together Sales revenue x sales commission percentage commission Sales revenue x shipping expenses percentage shipping Sales revenue x selling expenses percentage misc expenses 46 Know which budget is the rst budget prepared as part of the master budget 0 Sales budget 47 Know how to calculate units to be produced production budget if given expected sales units desired ending inventory units beginning inventory units 0 Sales Desired Total need for year 0 Total need for year beginning inventory 0 This gives us how much we need to produce 0 Sales Desired Beginning Production 48 Know which budget provides the starting point for preparing the direct laborbudget Production budget 49 Know how to calculate the variable costs and xed costs for a exible budget at a speci c level of production if given a static budget units of production direct labor costs electric costs and total xed costs 0 Number of units produced 1000u Total all costs 100000 FINAL EXAM STUDY GUIDE Flexible number of units 3000u Fixed costs are constant at both exible and static Solve for variable cost at static D variable per unit will stay the same at 3000 50 Know how to calculate total cash collected during a month if given sales of sales that are cash of sales that are credit of credit sales collected during the month of sale of credit sales collected during the following month Sales x of sales that are cash 0 Sales x 10 Sales x opposite of sales that are cash of sales that are credit 0 Sales x 90 Sales x opposite of sales that are cash x of sales for current month of credit sales collected during month of sale 0 Sales x 90 x 60 Sales x opposite of sales that are cash x opposite of sales for current month sales collected for next month 0 Sales x 90 x 40
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