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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. Working totals






2. The amount allocated to any one accounting period.






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






4. Cash account






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






6. Contains only balance sheet accounts.






7. Increases






8. When title to merchandise passes from the supplier to the purchaser and creates an obligation to pay.






9. Postponement of recognition of an expense already paid.






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






11. Accounting periods of less than a year.






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






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






14. The practice of recording transactions at exchange price at the point of recognition.






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






16. People that estimate various things






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






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






19. Deferral of an expense! (Except land)






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

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21. Decreases






22. Close the revenues account - Close the expense account - Close the income summary account - Close the dividends account






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






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






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






26. customer inquires about availability of service -company hires new employee -company signs contract to provide service in future






27. Unless there is evidence to the contrary - the accountant assumed that the business will continue to operate indefinitely






28. Their related asset accounts on the balance sheet






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






30. The ability to have enough cash to pay debts when they are due.






31. Sole worker of your business






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






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






34. A net loss occurs






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






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






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






38. The net amount - or 'Book Value' of an asset






39. Made at the end of accounting period..-They clear revenue - expense accounts - and dividends account of their balances. -Summarize a period's revenue and expenses by transferring the balances of them to the income summary account






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






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






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






43. Deals with all techniques accountants use to apply the matching rule: Recording revenue when they are earned - Recording expenses when they are incurred - More closely related to profitability - Adjusting the accounts






44. Accounting Equation






45. Accounting for revenues in the period in which cash is received and for expenses in the period where cash is paid. More closely related to the goal of liquidity.






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






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






48. Decreases






49. 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






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