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






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






3. Choosing the number of accounting periods






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






5. Increases






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






7. International Accounting Standards Board.






8. Their related asset accounts on the balance sheet






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






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






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

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12. Lists all accounts and their balances






13. 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)






14. As an expense and the corresponding liability accumulate.






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






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






17. Sole worker of your business






18. 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






19. Working totals






20. A net loss occurs






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






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






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






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






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






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






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






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






29. 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.






30. Accounting Equation






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






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






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






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






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






36. 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.






37. Contributed Capital + Retained Earnings

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






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






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






41. Cash account






42. Decreases






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






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






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






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






47. Contains only balance sheet accounts.






48. Revenues - Expenses






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






50. Accounting periods of less than a year.