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Test your basic knowledge |
CLEP Financial Accounting
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Subjects
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clep
,
business-skills
Instructions:
Answer 50 questions in 15 minutes.
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study here
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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. Shows the changes in RE over an accounting period.
Stockholder's Equity
Board of Directors
Statement of Retained Earnings:
Recognizing unrecorded - earned revenues
2. A separate account that is paired with a related account
IASB
Recognizing unrecorded - earned revenues
Events that are recorded as transactions
Contra Account
3. People that estimate various things
Permanent Accounts (Real Accounts)
'Big Bath Theory'
Actuaries
Mutual Agency
4. Generally Accepted Accounting Principles - or guidelines for financial accounting.
Net Income =
GAAP
Accounting Equation
Accumulated Depreciation Accounts
5. Customer buys a service - company pays an employee for service - company performs service
Securities Exchange Commission (SEC)
Sole proprietorship
Events that are recorded as transactions
Accumulated Depreciation accounts are deducted from..
6. The practice of recording transactions at exchange price at the point of recognition.
GAAP
Cost Principle
Operating Activities
Normal Balance
7. As an expense and the corresponding liability accumulate.
Accumulated Depreciation Accounts
Accrued Expenses
Mutual Agency
SEC Requirements for transactions
8. Decreases
Income Statement
Dividends are what to SE
Revenues are what to SE..
Accounting Equation
9. Working totals
Recognition Point
Footings
Post-closing trial balance
Allocating recorded - unearned revenues between 2 or more accounting periods (ARUR)
10. 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.
Accrued Expenses
Recognizing unrecorded - earned revenues
Allocating recorded - unearned revenues between 2 or more accounting periods (ARUR)
Interim Periods
11. Decreases
Steps for Income Summary Account
Expenses are what to SE..
Accrued Expenses
Adjusting entries affect...
12. Wages - Interest - and Income taxes that have been incurred but have not been recorded during an accounting period.
Board of Directors
Recognizing Unrecorded Expenses (RUE)
'Big Bath Theory'
Accrued revenues
13. A net loss occurs
When expenses exceed revenues..
Accumulated Depreciation Accounts
Expenses are what to SE..
GASB
14. Choosing the number of accounting periods
Accrued revenues
Depreciation
Continuity
Accrual Accounting
15. Balance sheet accounts - such as cash and accounts payable because they carry their end-of-period balances into the next accounting period
Post-closing trial balance
Mutual Agency
Permanent Accounts (Real Accounts)
Recognizing Unrecorded Expenses (RUE)
16. Financial Accounting Standards Board - Designed by SEC to develop rules on accounting practice.
Continuity Assumption
GAAP
FASB
Board of Directors
17. The ability to have enough cash to pay debts when they are due.
'Big Bath Theory'
Liquidity
Operating Activities
Expenses are what to SE..
18. Deferral of an expense! (Except land)
Valuation Issue
Long term assets are..
Fiscal Year
Contra Account
19. Government Accounting Standards Board - similar to FASB - issues accounting standards for state and local governments.
GASB
Dividends are what to SE
Balance Sheet
When expenses exceed revenues..
20. Payments of rent - insurance - supplies - and the depreciation of plant and equipment
Contra Account
Cost Principle
Allocating recorded costs between 2 or more accounting periods (ARC)
Steps for Income Summary Account
21. The predetermined time at which a transaction should be recorded.
Stockholder's Equity =
GASB
Recognition Point
Final Trial Balance
22. Accounting Equation
Accounting Equation
Closing Entries
Normal Balance
Recognition Point
23. Close the revenues account - Close the expense account - Close the income summary account - Close the dividends account
Steps for Income Summary Account
Earnings Management
Liquidity
Continuity Assumption
24. Their related asset accounts on the balance sheet
GAAP
Consignment Sale
Accumulated Depreciation accounts are deducted from..
Mutual Agency
25. Society recognizes you as a partner of your partnership - so if you or they do something stupid - you are bound to that deal.
Adjusting entries NEVER affect..
Income Statement
Mutual Agency
GAAP
26. Contributed Capital + Retained Earnings
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27. 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
Accrual Accounting
Continuity Assumption
'Big Bath Theory'
Footings
28. Forces a monetary value to a business transaction and accounting for the assets and liabilities that result from the transaction.
Fiscal Year
Sole proprietorship
Cost Principle
Valuation
29. Revenues that a company has earned but for which no entry has been made in the accounting records
Liquidity
Accrued revenues
Accumulated Depreciation Accounts
Board of Directors
30. Cash account
Accounting Equation
Statement of Retained Earnings:
'Big Bath Theory'
Adjusting entries NEVER affect..
31. Used to accumulate the depreciation on each long-term asset
Income Statement
Accrual Accounting
Accumulated Depreciation Accounts
'Big Bath Theory'
32. Accounting periods of less than a year.
Accrued revenues
Interim Periods
Valuation
Earnings Management
33. Revenues - Expenses
GAAP
Interim Periods
Net Income =
When expenses exceed revenues..
34. The net amount - or 'Book Value' of an asset
Carrying Value
We Recognize A Transaction
Expenses are what to SE..
Valuation
35. Contains only balance sheet accounts.
Net Income =
Events that are recorded as transactions
Income Statement
Final Trial Balance
36. Companies present annual financial statements on the assumption that the business will continue to operate indefinitely
Going Concern
Recognition
Events that are recorded as transactions
Post-closing trial balance
37. Focuses on assigning a monetary value to a business transaction and accounting for assets and liabilities.
Not recorded as transactions
Permanent Accounts (Real Accounts)
Normal Balance
Valuation Issue
38. It's usual balance and is the side (debit or credit) that increases the amount.
Normal Balance
Valuation Issue
Stockholder's Equity =
Accrual Accounting
39. Increases
We Recognize A Transaction
Revenues are what to SE..
Recognizing Unrecorded Expenses (RUE)
Balance Sheet
40. Determines that all temporary accounts have zero balances and to double check that total debits = total credits
Income Summary Account
Dividends are what to SE
Post-closing trial balance
GAAP
41. Postponement of recognition of an expense already paid.
Deferral
Dividends are what to SE
Expenses are what to SE..
Balance Sheet
42. Separate legal entities - and the corporation can enter contracts and also be sued. Stockholder's cannot be sued.
Corporations
Permanent Accounts (Real Accounts)
Valuation
Statement of Retained Earnings:
43. 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
Going Concern
Balance Sheet
Mutual Agency
Closing Entries
44. Selling goods and services to customers - employing managers and workers.
Recognition
Matching Rule
Income Summary Account
Operating Activities
45. The estimation of business's net income in terms of accounting periods.
Interim Periods
Periodicity
Footings
Fiscal Year
46. A 12 month accounting period (Vary depending on slack seasons)
Fiscal Year
Balance Sheet
Expenses are what to SE..
Consignment Sale
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.
Closing Entries
'Big Bath Theory'
Permanent Accounts (Real Accounts)
Securities Exchange Commission (SEC)
48. Sole worker of your business
Adjusting entries NEVER affect..
Fiscal Year
Statement of Retained Earnings:
Sole proprietorship
49. International Accounting Standards Board.
IASB
Accrual Accounting
Adjusting entries affect...
Recognition Point
50. At a specific point in time (Certain Date)....Assets - Liabilities - Stockholder's equity.
Stockholder's Equity =
Balance Sheet
Permanent Accounts (Real Accounts)
Interim Periods
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