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






2. Decreases






3. Sole worker of your business






4. The amount allocated to any one accounting period.






5. People that estimate various things






6. A net loss occurs






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






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






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






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






11. Choosing the number of accounting periods






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






13. International Accounting Standards Board.






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






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






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






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






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






19. 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






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






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






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






23. 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.






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






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






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






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

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






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






30. Contains only balance sheet accounts.






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






32. Contributed Capital + Retained Earnings

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






34. 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






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






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






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






38. Deferral of an expense! (Except land)






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






40. Revenues - Expenses






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






42. 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






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






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






45. Postponement of recognition of an expense already paid.






46. Increases






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






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






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