11/27/2013 Exam | An Introduction to Financial Accounting https://class.coursera.org/accounting-001/quiz/attempt?quiz_id=183 1/6 Help Thank you! Final Exam, Part 2 The due date for this exam is Wed 27 Nov 2013 8:59 PM PST . You may attempt the exam three times. The highest of the three scores will be entered as your grade for the exam. Please double-check your answers before submitting; I will not reset attempts for mistaken submissions. You will see your score as soon as you submit your exam. But, the solution will not be available until after the deadline passes. You are not allowed to provide answers or hints to the exam questions on the discussion boards! You must work alone, but you can use any of the posted course materials to answer the questions. The deadline for completing the exam is 11:58:00 pm U.S. Eastern Time on November 27, 2013. Good luck! In accordance with the Coursera Honor Code, I (M. Faisal Niazi) certify that the answers here are my own work. Question 1 Gunawardena Ltd. has a building that it originally bought for $100,000. As of December 31, 2012, there is $10,000 of Accumulated Depreciation on the building (it was being straight-line depreciated over 10 years with no salvage value). On January 1, 2013, the company decides to change the remaining useful life to 5 years (starting now) with a $50,000 salvage value.
Week 1: Introduction and Balance Sheet
To learn a foreign language like Accounting, you need quite a bit of practice in the basic foundations (grammar, syntax, idioms, etc.). This material is absolutely essential for being able to read and to understand books written in the language (in our case, financial statements.). This week, we will starting building these foundations. We will start with an overview of financial reporting. What types of reports are required? Who makes the rules? Who enforces the rules? Then, we will cover the balance sheet equation and define/discuss Assets, Liabilities, and Stockholders' Equity. We will introduce debit-credit bookkeeping and do lots of practice in translating transactions into debits and credits. Finally, we will introduce a case of a start-up company to provide you insights into all of the steps necessary to go from recording the first transactions of a new business all the way through its first set of financial statements.
Week 2: Accrual Accounting and the Income Statement
We will start with a discussion of Accrual Accounting and how it affects the recognition of the Income Statement accounts: Revenues and Expenses. Then, we will cover adjusting entries, which are needed to prepare our internal books for the upcoming financial statements. Finally, we will discuss closing entries and the preparation of the Balance Sheet and Income Statement. At each stage, we will continue to work on the case of our start-up company. If you are not sick and tired of journal entries by the end of this week, then I have not done my job!
Week 3: Cash Flows
Cash is King! We will start with the classification of cash flows into operating, investing, and financing activities. Then, we will work on preparing and analyzing the Statement of Cash Flows. We will wrap up the case on the start-up company by preparing and analyzing its Statement of Cash Flows. Finally, we will discuss the differences between Earnings, Cash from Operations, EBITDA, and Free Cash Flow.
Week 4: Ratio Analysis and Final Exam
We will have our final exam this week. Because of the exam, I will cover Ratio Analysis, which will not involve any "new" material. While we will define and discuss a number of ratios, they will all basically involve dividing one accounting number by another. But, the analysis of what those ratios mean will involve a deep understanding of Balance Sheet and Income Statement accounts. Thus, the Ratio Analysis videos will help provide a nice review of the material, which will help you prepare for the exam. However, there will be no questions about ratio analysis on the exam. The only thing left to do after this exam is to impress your family, friends, and co-workers with your vast knowledge of Financial Accounting!