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






2. Revenues - Expenses






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






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






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






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






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






8. A net loss occurs






9. The amount allocated to any one accounting period.






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






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






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






13. Postponement of recognition of an expense already paid.






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






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






16. Choosing the number of accounting periods






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






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






19. 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






20. 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.






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






22. Cash account






23. Deferral of an expense! (Except land)






24. Contributed Capital + Retained Earnings

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






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






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






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

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29. Accounting periods of less than a year.






30. Working totals






31. Increases






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






33. Contains only balance sheet accounts.






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






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






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






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






38. As an expense and the corresponding liability accumulate.






39. Accounting Equation






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






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






42. Sole worker of your business






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






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






45. 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






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






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






48. Their related asset accounts on the balance sheet






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

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50. People that estimate various things