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






2. Decreases






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






4. Cash account






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






6. Their related asset accounts on the balance sheet






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






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






9. Increases






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






11. Revenues - Expenses






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






13. Choosing the number of accounting periods






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






15. Postponement of recognition of an expense already paid.






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






17. Sole worker of your business






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






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






20. As an expense and the corresponding liability accumulate.






21. 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.






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






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






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

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






26. Deferral of an expense! (Except land)






27. Accounting periods of less than a year.






28. International Accounting Standards Board.






29. Contains only balance sheet accounts.






30. A net loss occurs






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






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






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






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






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






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

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






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






39. Lists all accounts and their balances






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. People that estimate various things






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






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






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






45. 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.






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






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






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






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






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