Proficiency Exams for Financial Accounting and Statistics

The proficiency exams in financial accounting and statistics may be taken from 8:30 a.m. to 4:30 p.m. on weekdays.  The two evening dates prior to the Spring 2008 term are 12/3/07 from 6-9 p.m. and 12/20/07 from 6-9 p.m.  Both exams will be held in RBC 161.  Please email the office to reserve a seat for the exams, amme@lehigh.edu. Suggested study materials and a list of topics included on the exam are outlined in the attachments to this memo.  Books are available through the Lehigh University Bookstore.

The links below give you suggested study materials and a list of topics included on the exams.

Financial Accounting
Statistics

Books are available through the Lehigh University Bookstore.

Proficiency Exam Guidelines

• Students will be permitted to take the proficiency exams twice and must earn a grade of “B” or better on the exam to be waived from the prerequisite.
• There is no charge for taking or grading the proficiency exams.
• Students are expected to study on their own for the exam. Faculty will not be available for consultation on the exams.
• Students who have never taken a course on the exam material should not use the proficiency exam option unless they can learn the material independently. Students who have had a course on the topics should be able to review on their own.
• You are permitted three hours to complete the exam.

If you are a distance student, you may take the exams on site. Please arrange to take the exam at a convenient time with your site coordinator. Notify Anne Marie either by phone at 610) 758-4450 or amme@lehigh.edu of your intention to take the exam and the date the exam is needed. We will arrange to send the exam with proctoring instructions to your site coordinator. Please give us at least three days notice.

Financial Accounting

Format - The exam will consist of approximately 50 multiple choice questions, a table to describe the effects of transactions on the financial statements, preparation of a cash flow statement and a ratio analysis comparing two companies. Students will not be required to do journal entries.

Study Materials - Most financial accounting books cover similar material. You may use any basic financial accounting book printed after 1987 to prepare for the exam. If you do not have access to a basic financial accounting book, you may order a book from the Lehigh Bookstore. Suggested books would include the texts used in GBUS 401 or Accounting 151.

Topics

• Communication of Accounting Information
• Processing Accounting Information
• Income Measurement and Accrual Accounting
• Balance Sheet
• Income Statement
• Adjustment Process
• Merchandise Accounting and Internal Control
• Inventories and Cost of Goods Sold
• Cash and Receivables
• Property, Plant and Equipment, Natural Resources, Intangible Assets
• Current Liabilities
• Long-Term Liabilities (Bonds including present value and future value concepts))
• Retained Earnings and Stockholder's Equity
• Investments in Other Corporations
• Statement of Cash Flows
• Financial Statement Analysis

Helpful Hints

Please note that you will be required to do a Cash Flow Statement from the financial information on the income statement and balance sheet for the current year and previous year. It counts for 13 points on average out of a 100 point total so it is a critical part of the exam. A thorough understanding of inventory methods, forms of capitalization (company stock, dividends, issuing bonds), and the proper methods of accounting for investments is essential in the multiple choice section of the exam.

The Financial Ratio comparison requires that you tell us what the ratios mean and how they effect liquidity, profitability, return to investors etc. You do not actually need to calculate the ratios. The ratios will be given to you but you must interpret and compare the ratios across industries. It is not enough to simply state that the ratio for one industry is higher than the other.

Statistics

Format - Approximately 70 multiple choice questions.

Study Materials - Any basic statistics book may be used to prepare for this exam. Statistics books are relatively standard in their coverage of topics. Please compare the topics listed below to the book you choose. If you do not have access to a basic statistics book, suggested texts would include textbooks used in GECO 401 or Economics 145 which are available in the Lehigh University Bookstore.

Topics

• Data and Statistics
• Descriptive Statistics
• Tabular and Graphical Methods
• Numerical Methods
• Probability
• Discrete Probability Distributions
• Continuous Probability Distributions
• Sampling and Sampling Distributions
• Interval Estimation
• Hypothesis Testing
• Statistical Inference
• Tests of Goodness of Fit
• Analysis of Variance and Experimental Design
• Simple Linear Regression
• Multiple Regression
• Index Numbers

Helpful Hints

This exam is primarily conceptual. You do not need to memorize equations except for the regression equation. You must be able to interpret equations that are given to you, know when to apply individual equations and what the results mean. Vocabulary is also very important in this exam. You need to know statistical terms and what they mean.