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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. Cash account






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






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






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






5. Decreases






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






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






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






9. Revenues - Expenses






10. The amount allocated to any one accounting period.






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






12. 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)






13. A net loss occurs






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






15. Lists all accounts and their balances






16. International Accounting Standards Board.






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






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






19. Choosing the number of accounting periods






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






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






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






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






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

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25. Decreases






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






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






28. 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.






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

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30. Accounting Equation






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






32. 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.






33. Deferral of an expense! (Except land)






34. Accounting periods of less than a year.






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






36. People that estimate various things






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






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






39. 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






40. Contributed Capital + Retained Earnings

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41. Their related asset accounts on the balance sheet






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






43. Increases






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






45. Sole worker of your business






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






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






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






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






50. As an expense and the corresponding liability accumulate.