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DSST Principles Of Finance

Subjects : dsst, 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. Owners of a corporation who usually receive dividends. Also called stockholders.






2. A loan that is not backed by collateral - but by the promise of the borrower to repay it.






3. Length of time covered by financial statements; also called reporting period.






4. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.






5. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)






6. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).






7. A tax deferred account that allows individuals to plan for their retirement.






8. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.






9. Create the Public Company Accounting Oversight Board - regulates analyst conflicts - imposes corporate governance requirements - enhances accounting and control disclosures - impacts insider transactions and executive loans - establishes new types of






10. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.






11. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.






12. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.






13. The money left over when income exceeds expenditure.






14. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.






15. An investment scam that uses the assets from new investors to make payments to older investors. Named after Charles Ponzi who used the technique in the early 1900s to defraud thousands of investors.






16. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.






17. A loan that is backed by collateral such as cars - houses - or other assets.






18. Tool used to show the effects of transactions and events on individual accounts.






19. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.






20. Account showing the owner's claim on company assets; equals owner investments plus net income (or less net loss) minus owner withdrawals since the company's inception. Also called Equity.






21. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.






22. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.






23. Independent group of full-time members responsible for setting accounting rules.






24. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.






25. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.






26. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.






27. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.






28. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.






29. Obligations not due to be paid within one year or the operating cycle - whichever is longer.






30. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.






31. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.






32. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.






33. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.






34. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.






35. Owners of a corporation who usually receive dividends. Also called shareholders.






36. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.






37. Optional entries recorded at the beginning of a period that prepare the accounts for the usual journal entries as if adjusting entries had not occurred in the prior period.






38. Journal entries that affect at least three accounts.






39. Business owned by a single person.






40. Temporary account used only in the closing process to which the balances of revenue and expense accounts (including any gains or losses) are transferred. Its balance is transferred to the capital account (or retained earnings for a corporation).






41. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.






42. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.






43. The principle prescribing that revenue is recognized when earned.






44. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.






45. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.






46. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.






47. Statements that show the effect of proposed transactions and events as if they had occurred.






48. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.






49. A written framework to guide the development - preparation - and interpretation of financial accounting information.






50. Record containing all accounts (with amounts) for a business.