How to prepare and study for a bookkeeping exam

As an instructor who has taught accounting and bookkeeping, let me offer these helpful suggestions to improving your success and doing better.

Instructions

1. **Read questions and instructions carefully**

   One thing that I've noticed from students over the years is that quite often, they'll rush through a question and my instructions without first reading them carefully. This will cause mistakes to be made that could have easily been avoided.

   So don't rush! Read each question carefully and highlight keywords or anything that's really important. Also look at how your instructor wants your answers!

   For example, if I want you to show your work and you just provide an answer, you didn't follow my instructions. Now if I don't allow for partial credit, then you'll loose all the points. And this can really add-up! Even if I do allow partial credit, it could still make a difference between one grade an another.

   Also pay close attention to multi-part questions where you may have a part a, b, c, etc.

   It's common for students to skip one part because their eye missed it. So double-check that you answered all parts of each question before you turn it in for grading!

2. **Define concepts and terms first**

   I offer this suggestion to all my students! You cannot answer something if you can't tell me what it is.

   So be sure you define all terminology and concepts involved!

   If you have a question that involves debits and credits, then you had better know what debit and credit mean. And FYI, it doesn't mean plus or minus, which is a very common mistake accounting and bookkeeping students make.

   A debit is nothing more than the left side of the T-account. A credit is the right side.

3. **Defining example**

   Let me illustrate what I said in step 2 with this sample exam question:

   You need to journalize the purchase of a new asset that was bought for cash. The cash account would be ___ debited ___ credited.

   What are your keywords and concepts here?

   1) Journalizing = the recording of transactions

   2) Assets = things a company owns of value and held to generate revenue (profits)

   3) Asset purchased or bought using cash

   4) Cash is also an asset and went down (decreased) because it was spent

   5) Decreases to assets are recorded as credits, so cash would be credited.

   These are all of the things you'd essentially need to do in order to get your answer. So it's not memorizing, but rather defining things and understanding how they fit together.

   So approach every question with this process in mind.

4. **Accounting Equation is key**

   The most basic concept that forms the basis for everything else in bookkeeping or accounting is the accounting equation.

   This shows the relationship between assets, liabilities, and owners or stockholders equity.

   Everything else you'll learn builds upon this relationship and will go back to it. So how you record transactions, no matter what accounts in involves or what the transaction is, all comes back to your understanding of the accounting equation.

5. **Use acronmys to help you remember**

   Acronmys are quickie ways to help remember things. For example, how could you easily remember which account types get debited when they increase?

   I offer my students the following acronym to help: DEA

   D = Dividends
   E = Expenses
   A = Assets

   So anytime you need to increase an asset, expense, or dividend account, you'd remember to debit them.

   How does DEA help make it easier? Well think of it this way:

   a) D for "dee" left side of the accounting equation
   b) D for debit

   So this 3 letter acronym helps you more easily remember 3 account types and how increases are recorded.

6. **Understand the instructor mindset**

   As a student, it's important for you to understand how we as instructors think and operate. To you, class may or may not be a huge priority. And we do realize this.

   But to us--instructors--each of our classes is a hugh priority! So we expect our students to be fully-prepared and taking their work seriously.

   So walk into each exam with this understanding that we consider our material important to know and make it our priority.

7. **Questions**

   Some instructors use a pool of questions, while others create their own. I've worked both ways myself!

   The important thing to remember here is that some of the pooled questions may not be worded in the best way. And while some of us may revamp them to make them more student-friendly, others leave them alone.

   You should also realize pooled questions follow your textbook!

8. **Pooled questions continued**

   It's important to understand that just because pooled questions mirror your textbook, you cannot simply memorize your book.

   As I mentioned in step 7, some of us do revamp those questions so they may include things that aren't in your text. And we might even add our own questions to the pooled ones.

   But an important thing to realize with pooled questions is that you may or may not receive the same questions as your fellow students. I can program in specific questions to be made available to everyone, or can choose to have the system randomly select from among various choices.

   So understand how pooled questions can operate so you know what to expect.

9. **Budget your time well**

   Because bookkeeping and accounting require a great deal of thinking, you cannot simply memorize everything and do well. You've got to read things carefully and understand the situation involved.

   So I suggest you keep track of how long you're spending on each question. If you're struggling with something, then move on to the next one and come back later. Otherwise, you'll find yourself running out of time and lots of unanswered questions left!

10. **Exam length is unimportant**

    I've had plenty of students who's first question is, "How long is the exam?"

    This is totally unimportant! I can make a one question exam that tests everything or a 100 question that does the same thing. So what difference does it make how long it is? What's important is that your exam covers the concepts it needs to!

    So don't dwell on exam length. Concentrate on the concepts that are being tested and skimming the test to see which questions look like they'll take longer to complete.

    Those should be your priority because they'll take the most time. If you hold-off on them until later on, you may find yourself running out of time very quickly.