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






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






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






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






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






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






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






8. Accounting periods of less than a year.






9. Cash account






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






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






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






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






15. Postponement of recognition of an expense already paid.






16. The amount allocated to any one accounting period.






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

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






19. Sole worker of your business






20. Contains only balance sheet accounts.






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






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






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






24. Accounting Equation






25. 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)






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






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






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






29. As an expense and the corresponding liability accumulate.






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






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






32. Increases






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






34. A net loss occurs






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






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






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






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






39. Deferral of an expense! (Except land)






40. Contributed Capital + Retained Earnings

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41. Working totals






42. 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






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






44. Choosing the number of accounting periods






45. Decreases






46. Revenues - Expenses






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






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






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






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