through the additional study questions document located in the documents section of the community.  Make sure you answer each question in as much detail as possible.  For example:  The first item under the Financial Accounting section asks something like; "What are the components that comprise a typical Financial Statement?"  In order to answer this question you need to know what the basic 4 Financial Statements are.  What categories or sections are on each statement?  What accounts are shown under each section of each Financial Statement?  How do amounts from one statement flow through to the other statements, if at all?  What does each Financial Statement tell a user or reader of that Financial Statement?

Financial Statements

1. List the components that comprise a typical financial statement.
2. Describe how changes to a company’s revenue and expenses affect their Income Statement and Balance Sheet.
3. How do changes in the Income Statement and Balance Sheet data affect a Statement of Cash Flows?
4. Explain how you can evaluate the financial condition of a firm by reviewing the Balance Sheet.
5. How can you determine the contribution margin from an Income Statement?
6. How is a horizontal and vertical analysis calculated?

Horizontal Analysis Vertical Analysis

1. Describe how horizontal analysis and vertical analysis of a Balance Sheet are used to evaluate a firm’s performance over a period of time.
2. What two methods can be used to prepare a Statement of Cash Flows?
3. What three categories are shown on the Statement of Cash Flows? What accounts are shown under each category?

Ratios

1. What is the difference between liquidity ratios and solvency ratios and what is their relationship to a firm’s profitability?
2. What is the difference between profitability ratios and market prospect ratios?
3. Which ratios are liquidity, solvency, profitability, and market prospect? How are they calculated?
4. How does the interpretation of financial data differ depending upon the perspective of the person analyzing the data?

Cost Analysis:

1. What is the difference between direct and indirect costs?
2. What is the difference between sunk costs, opportunity costs, and differential costs?
3. What is a cost variance analysis?
4. Describe the difference between activity-based costing and traditional allocation methods. When should you use activity based costing?
5. Define a job order costing system and a process costing system.
6. In what type of activity would you use job order costing? Process costing?
7. How is the contribution margin calculated?
8. What is Cost-Volume-Profit Analysis (CVP)?
9. How is the breakeven point in units calculated?
10.  How is the breakeven point in sales dollars calculated?
11. What is a variable cost?  What is a fixed cost?

Capital Structure:

1. What are the four types of bonds and what are their characteristics?
2. What is the price of a bond issued at par value, a discount, a premium?
3. What impact does the market rate of interest have on the price of a bond?
4. How do you calculate the interest expense for bonds issued at a discount or premium using the straight-line method?
5. How do you calculate the interest expense for bonds issued at a discount or premium using the effective interest method?
6. Compare and contrast issuing common stock, preferred stock, and bonds as a means for creating capital.
7. How are bond ratings determined?
8. How are dividend policies determined?
9. Compare and contrast operating leverage and financial leverage.

Information Technology:

1. List the standard components of an information system.
2. Describe how information systems support an organization’s business processes.
3. Describe the primary roles and responsibilities of information technology personnel in an organization.
4. Describe information technology strategic planning and how it differs from Business management strategic planning.
5. Describe software applications that support specific tasks or functions.

1. Describe how information technology (specifically Internet strategies) can be used to develop competitive strategies in an organization.
2. How is information technology used to re-engineer business processes?
3. Can creating a virtual company provide a company with a competitive advantage? Explain.
4. Explain how a company may use a knowledge management system to increase their competitive advantage.

Privacy and Security:

1. Describe networking alternatives. What are the advantages and disadvantages of each?
2. How can using a database management approach to managing data resources be an advantage to an organization?
3. Describe data retention or destruction policies.
4. Explain the concept of client/server networking
5. Explain the business value of e-commerce marketplaces.
6. Describe the correct use of an information portal in an organization.

Information Technology Roles and Systems:

1. Describe information security risks inherent to an organization.
2. How can organizations prevent Internet-based attacks on their technology Infrastructure?
3. Describe effective disaster recovery methods.
4. What are examples of a security breach in an organization?

1. How do the roles and responsibilities of information technology management and business management differ in an organization?
2. How can the application of decision support systems, business intelligence, or knowledge management systems help a business achieve their goals?
3. What is an enterprise system?
4. Describe ethical considerations for using information technology in an organization.