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CLEP Financial Accounting

Subjects : clep, business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. customer inquires about availability of service -company hires new employee -company signs contract to provide service in future






2. Net income on the income statement - and profitability comparisons from one accounting period to the next.






3. Determines corporate policy - declares dividends and appoints management.






4. International Accounting Standards Board.






5. Accounting periods of less than a year.






6. Summarizes revenues earned and expenses incurred by a business over an accounting period. (Shows whether a business achieved its profitability goal)...Revenues - Expenses - Income taxes






7. Companies present annual financial statements on the assumption that the business will continue to operate indefinitely






8. Decreases






9. Lists all accounts and their balances






10. Customer buys a service - company pays an employee for service - company performs service






11. The estimation of business's net income in terms of accounting periods.






12. At a specific point in time (Certain Date)....Assets - Liabilities - Stockholder's equity.






13. Financial Accounting Standards Board - Designed by SEC to develop rules on accounting practice.






14. Revenue that a company has earned for providing a service but for which it has not billed or been paid by the end of the accounting period.






15. Contributed Capital + Retained Earnings

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16. Focuses on assigning a monetary value to a business transaction and accounting for assets and liabilities.






17. A 12 month accounting period (Vary depending on slack seasons)






18. The manipulation of revenues and expenses to achieve a specific outcome.






19. A body of people set up by Congress who protect the public by regulating the issuing - buying - and selling of stocks in the US.






20. Postponement of recognition of an expense already paid.






21. Accounting Equation






22. A temporary account that summarizes all revenues and expenses for the period.






23. Their related asset accounts on the balance sheet






24. Selling goods and services to customers - employing managers and workers.






25. Cash account






26. Determines that all temporary accounts have zero balances and to double check that total debits = total credits






27. Contains only balance sheet accounts.






28. Balance sheet accounts - such as cash and accounts payable because they carry their end-of-period balances into the next accounting period






29. Match expenses with the revenues that they help generate - & vice versa.






30. The difficulty of deciding when a business transaction should be recorded






31. Generally Accepted Accounting Principles - or guidelines for financial accounting.






32. A net loss occurs






33. Wages - Interest - and Income taxes that have been incurred but have not been recorded during an accounting period.






34. Working totals






35. When an entity sends out a product to a distributor and takes a certain percentage for what they sell it for (Usually occurs when they have excess inventory)






36. A separate account that is paired with a related account






37. Society recognizes you as a partner of your partnership - so if you or they do something stupid - you are bound to that deal.






38. Forces a monetary value to a business transaction and accounting for the assets and liabilities that result from the transaction.






39. Shows the changes in RE over an accounting period.






40. Government Accounting Standards Board - similar to FASB - issues accounting standards for state and local governments.






41. Payments received in advance - and deposits made on goods and services






42. As an expense and the corresponding liability accumulate.






43. Separate legal entities - and the corporation can enter contracts and also be sued. Stockholder's cannot be sued.






44. Sole worker of your business






45. The predetermined time at which a transaction should be recorded.






46. Revenues that a company has earned but for which no entry has been made in the accounting records






47. If you're having a bad year - to dump everything into something else like pensions

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48. Used to accumulate the depreciation on each long-term asset






49. Deferral of an expense! (Except land)






50. Persuasive evidence of arrangement - Seller's price is fixed or determinable - Product or service has been delivered - Collectibility is reasonably assured