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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 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.






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






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






4. Their related asset accounts on the balance sheet






5. Accounting Equation






6. Postponement of recognition of an expense already paid.






7. 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






8. The amount allocated to any one accounting period.






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






10. Accounting periods of less than a year.






11. Choosing the number of accounting periods






12. Contributed Capital + Retained Earnings

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13. A net loss occurs






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






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






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






17. Decreases






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






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






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






21. Contains only balance sheet accounts.






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






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






24. Government Accounting Standards Board - similar to FASB - issues accounting standards for state and local governments.






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






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

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






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






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






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






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






33. 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






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






35. Increases






36. Decreases






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






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






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






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

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






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






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






44. Lists all accounts and their balances






45. International Accounting Standards Board.






46. 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






47. People that estimate various things






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






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. Cash account