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






2. 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)






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






4. A net loss occurs






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






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






7. As an expense and the corresponding liability accumulate.






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






9. Working totals






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






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






12. Accounting periods of less than a year.






13. Decreases






14. Payments of rent - insurance - supplies - and the depreciation of plant and equipment






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






16. Lists all accounts and their balances






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






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






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






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






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






22. Common Stock + Retained Earnings - Dividends + Revenues - Expenses

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






24. Sole worker of your business






25. Revenues - Expenses






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






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






28. Accounting Equation






29. 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






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






31. Contributed Capital + Retained Earnings

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32. Decreases






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






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






35. It's usual balance and is the side (debit or credit) that increases the amount.






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






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






38. Postponement of recognition of an expense already paid.






39. International Accounting Standards Board.






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






41. The amount allocated to any one accounting period.






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






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






44. People that estimate various things






45. Choosing the number of accounting periods






46. Cash account






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






48. Deferral of an expense! (Except land)






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






50. 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.