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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. Accounting periods of less than a year.






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






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






4. Postponement of recognition of an expense already paid.






5. 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)






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

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7. 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.






8. People that estimate various things






9. Cash account






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






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






12. Sole worker of your business






13. Their related asset accounts on the balance sheet






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






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






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






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






18. Deferral of an expense! (Except land)






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






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






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






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






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






24. Increases






25. A net loss occurs






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






27. Choosing the number of accounting periods






28. As an expense and the corresponding liability accumulate.






29. Contains only balance sheet accounts.






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






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






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






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






35. Decreases






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






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






38. Working totals






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






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






41. 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






42. The amount allocated to any one accounting period.






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






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






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






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






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






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






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






50. Decreases