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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. 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)






2. Increases






3. The amount allocated to any one accounting period.






4. Revenues - Expenses






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






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






7. 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






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

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






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






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






12. 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






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






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






15. Deferral of an expense! (Except land)






16. International Accounting Standards Board.






17. Contains only balance sheet accounts.






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






19. Accounting periods of less than a year.






20. Accounting Equation






21. As an expense and the corresponding liability accumulate.






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






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






24. Decreases






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






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






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






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






29. Cash account






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






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






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






33. Lists all accounts and their balances






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






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






36. People that estimate various things






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






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






39. 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.






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






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






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






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






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






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






47. 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.






48. Decreases






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






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