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






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






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






4. 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






5. Deferral of an expense! (Except land)






6. Choosing the number of accounting periods






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






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






9. 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.






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






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






12. Sole worker of your business






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






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






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






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






17. A net loss occurs






18. Working totals






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






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

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






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






23. Increases






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






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






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






27. Accounting Equation






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






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






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






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






32. 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






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






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






35. As an expense and the corresponding liability accumulate.






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






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






38. Revenues - Expenses






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






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






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






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






43. 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.






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






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






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






47. Contributed Capital + Retained Earnings

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48. The amount allocated to any one accounting period.






49. Contains only balance sheet accounts.






50. Postponement of recognition of an expense already paid.