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






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






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






4. Sole worker of your business






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






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






7. 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.






8. Revenues - Expenses






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






10. 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






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






12. 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.






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






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






15. The amount allocated to any one accounting period.






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






17. Working totals






18. Accounting Equation






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






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






21. Decreases






22. Deferral of an expense! (Except land)






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






24. Increases






25. Contributed Capital + Retained Earnings

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






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






28. As an expense and the corresponding liability accumulate.






29. Contains only balance sheet accounts.






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

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31. Lists all accounts and their balances






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






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






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






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






36. International Accounting Standards Board.






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






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






39. Postponement of recognition of an expense already paid.






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






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






43. Cash account






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






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






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






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






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






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






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