Test your basic knowledge |

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

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






3. People that estimate various things






4. Working totals






5. Revenues - Expenses






6. 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)






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






8. The amount allocated to any one accounting period.






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






10. Postponement of recognition of an expense already paid.






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






12. Contains only balance sheet accounts.






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






14. Contributed Capital + Retained Earnings

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






16. 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






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






18. International Accounting Standards Board.






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






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






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






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






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






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






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






26. Sole worker of your business






27. Accounting Equation






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






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






30. Accounting periods of less than a year.






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






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






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






34. Increases






35. Cash account






36. Decreases






37. 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.






38. Lists all accounts and their balances






39. A net loss occurs






40. Deferral of an expense! (Except land)






41. Decreases






42. 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






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






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






45. Choosing the number of accounting periods






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






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






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






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






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