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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. Determines corporate policy - declares dividends and appoints management.






2. Decreases






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






4. Postponement of recognition of an expense already paid.






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






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






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






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






9. International Accounting Standards Board.






10. Choosing the number of accounting periods






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






12. Their related asset accounts on the balance sheet






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






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






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






16. The amount allocated to any one accounting period.






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






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






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






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






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






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






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






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






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






26. Contains only balance sheet accounts.






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






28. 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






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






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






31. Working totals






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






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






34. Cash account






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






36. Sole worker of your business






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






38. 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)






39. Accounting periods of less than a year.






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

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41. A net loss occurs






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






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

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44. Accounting Equation






45. Lists all accounts and their balances






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






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






48. 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






49. 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.






50. Revenues - Expenses