1. Define net income and its two major components, revenues and expenses.



2. Explain how the income measurement issues of accounting period, continuity, and matching are resolved.



3. Define accrual accounting and explain three broad ways of accomplishing it.



4. State four principal situations that require adjusting entries and prepare typical adjusting entries.



5. Prepare financial statements from an adjusted trial balance.



Supplemental Objective

6. Analyze cash flows from accrual-based information.



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