In order to successfully complete the 3A Accounting test on chapter #5, the student should be able to perform the following cognitive tasks:

• demonstrate the process involved in completing a Six-column Worksheet.

• discuss the advantages associated with using the Six-column worksheet to prepare the final Income Statement and related Balance Sheet.

• demonstrate how one would deal with either of the following situations within the worksheet:
  • net income, and
  • net loss.

  Reference: Text, chapter #5; pages 164 - 169

• use a completed six-column worksheet to create a formal Income Statement and it's related Balance Sheet.

• demonstrate the following concepts within the creation of formal financial statements:
  • account form balance sheet,
  • report form balance sheet,
  • classified balance sheet,
  • current asset,
  • fixed asset,
  • cost principle,
  • cost price,
  • current liabilities, and
  • long-term liabilities.

  (NOTE: The above concepts could be included within multiple choice questions as well.)

  Reference: Text, chapter #5; pages 172 - 179.

• discuss/identify what an Income Statement and/or a Balance Sheet says;

• discuss/identify what an Income Statement and/or Balance Sheet does NOT say;

• explain/identify the substance of any of the following GAAPs related to formal financial statements:
  • Revenue Recognition Principle
  • Expense Recognition Principle
  • Matching Principle
  • Cost Principle
  • Principle of Conservatism
  • Materiality Concept
  • Entity Concept

  References: Text, chapter #5; pages 184 - 194.