Intermediate accounting takes financial accounting, which is the language of business directed to

the external user of the financial statements, to the next level. It fleshes out all the topics that your
financial accounting class briefly touches upon and serves as a bridge between basic financial
accounting and advanced financial accounting, which really gets into the nitty-gritty of handling
financial transactions.

Along the way, you still encounter your old friends, the income statement, balance sheet, and
statement of cash flows. And while preparation of the financial statements stays the same no matter
what type of financial accounting class you take, intermediate accounting assumes you have a basic
understanding of financial accounting and introduces you to more advanced accounting scenarios.
For example, you get into inventory issues beyond cost flow assumption and find out about more
advanced leasing topics such as residual value.

Although all business students have to take some form of financial accounting class, usually only
students interested in pursuing a career in this field move on to intermediate accounting. Plus,
intermediate accounting is a prerequisite for advanced financial accounting in many schools, which
is a must-take class to prepare for the certified public accountant (CPA) exam