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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. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.






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






3. Loaning or giving money to a business in orer to save it from bankruptcy.






4. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.






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






6. Analysis and report of an organization's accounting system - its records - and its reports using various tests.






7. 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.






8. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.






9. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Matching Principle.






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






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






12. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.






13. The combining of two or more comapnies into one larger company.






14. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.






15. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.






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






17. List of accounts used by a company' includes and identification number for each account.






18. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.






19. A legal entity that is seperate from its owners.






20. Process of recording transactions in a journal.






21. Business owned by a single person.






22. Assets pulled out of the business by the owner.






23. Area of accounting aimed mainly at serving external users.






24. Accounting information is based on cost with potential subsequent adjustments to fair value.






25. Process of transferring journal entry information to the ledger; computerized systems automate this process.






26. Rules that specify acceptable accounting practices.






27. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.






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






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






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






31. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.






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






33. The money left over when income exceeds expenditure.






34. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.






35. Expenses that remain the same regardless of the circumstances.






36. Debt securities that are issued by a borrower to raise capital . Bonds guarantee payments of the original amount borrowe plus interest and/or repayable on a fixed rate when the bond matures.






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






38. Income from investments - including dividends - interest - or the sale of a property.






39. The central bank of the United States - with 12 Federal Reserve branch banks located in major cities throughout the nation. It helps to regulate the US monetary and banking system.






40. Normal time between paying cash for merchandise or employee services and receiving cash from customers.






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






42. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.






43. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.






44. List of accounts and balances prepared before accounting adjustments are recorded and posted.






45. Assets = Liabilities + Equity; Equity equals [Owner capital - owner withdrawal + revenue - expenses] for a non-corporation; Equity equals [Contributed capital - retained earnings + revenue - expenses] for a corporation where dividends are subtracted






46. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.






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






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






49. Assets put into the business by the owner.






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