- Demonstrate a full understanding of the various concepts and terms. (Ex. long-term liabilities, dilutive securities, earnings per share, investments, revenue recognition).
- Compute completion rate to satisfy the revenue recognition principle. Calculate the Earnings per share and the goodwill resulted from the difference in the value of investments.
- Distinguish between accounting treatment for bond as an investment and as a long term liability. Compare and contrast between short and long term investment, as well as financial and operating leases.
- Record the necessary journal entries to account for bond as an investment and prepare the amortization schedule of bonds as a long term liabilities.
- Discriminate between the two cases of classifying the bonds in the financial statements to avoid errors and fraudulent acts of reporting.