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Test your basic knowledge |
DSST Principles Of Finance
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Study First
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. Business owned by a single person.
Sole Proprietorship
Ethical Dilemma
Sole Propietorship
Financial Accounting
2. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Federal Reserve System
Adjusting Entry
Post Closing Trial Balance
Business Entity Assumption
3. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
SEC (Securites and Exchange Commision)
Accrued Revenues
Materiality Constraint
Account Balance
4. All purpose journal for recording the debits and credits of transactions and events.
General Journal
Partnership
Temporary Accounts
Stock
5. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Posting Reference Column
Sole Propietorship
External Transactions
Corporations
6. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Straight-line Depreciation Method
Return
Ethical Dilemma
Sarbanes-Oxley Act (SOX)
7. 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.
Return
Bonds
Accounting
Equity
8. Business owned by one person that is not organized as a corporation.
Sole Proprietorship
Time Period Assumptions
Liabilities
Cost Principle
9. Rules that specify acceptable accounting practices.
Generally Accepted Accounting Principles
Interim Financial Statements
Sole Proprietorship
General Journal
10. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Reversing Entries
Time Period Assumptions
Cash Basis Accounting
Present Value
11. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
General Journal
Audit
Interim Financial Statements
IPO
12. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Cash Basis Accounting
Prepaid Expenses
Materiality Constraint
Accounting
13. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Ethical Dilemma
T Account
Corporation
Cost Principle
14. Statements that show the effect of proposed transactions and events as if they had occurred.
Pro Forma Financial Statement
SMART Goal
Accrued Revenues
Chart of Accounts
15. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Current Liabilities
Corporations
Internal transactions
International Financial Reporting Standards
16. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Compound Journal Entries
SMART Goal
Pro Forma Financial Statement
Business Entity Assumption
17. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Cost Principle
Current Assets
Stockholders
Expanded Accounting Equation
18. Assets put into the business by the owner.
Bailout
Owner Investment
Debt Ratio
Deficit
19. Creditors' claims on an organization's assets; involves a probable future payment of assets - products - or services that a company is obligated to make due to past transactions or events.
Financial Accounting
Liabilities
IPO
Annual Financial Statements
20. A loan that is backed by collateral such as cars - houses - or other assets.
Operating Cycle
Internal users
Secured Loan
Working Papers
21. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Expanded Accounting Equation
Secured Loan
Plant Assets
Long Term Investments
22. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.
Bailout
Cost Principle
Corporation
CD (Certificate of Deposit)
23. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Financial Accounting Standards Board
Natural Business Years
Time Period Assumptions
Interim Financial Statements
24. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Debtors
Current Ratio
Time Period Assumptions
Ethical Dilemma
25. Tool used to show the effects of transactions and events on individual accounts.
Fixed Expense
T Account
Financial Accounting Standards Board
Partnership Agreement
26. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Risk Tolerance
Passive Income
Book Value
Bailout
27. Owners of a corporation who usually receive dividends. Also called shareholders.
Liabilities
Mergers
Stockholders
Ethical Dilemma
28. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Common Stock
Recordkeeping
Generally Accepted Accounting Principles
Closing process
29. Outflows or using up of assets as part of operations of business to generate sales.
Shares
Partnership
Adjusting Entry
Expenses
30. An acronym for the National Association of Securities Dealers Automated Quotations. NASDAQ was founded in 1970 and is the largest electronic stock exchange in the United States. Unlike the NYSE - it has no physical location - existing entirely on cyb
Time Period Assumptions
Permanent Accounts
NASDAQ
Statement of Owner's Equity
31. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Discretionary Income
Reversing Entries
Long Term Liabilities
Revenues
32. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Risk Tolerance
Natural Business Years
Surplus
Account
33. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Credit
Adjusted Trial Balance
Unclassified Balance Sheets
Corporation
34. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Partnership
Stock
Mergers
Materiality Constraint
35. Uncertainty about expected return.
Risk
Current Liabilities
Present Value
Bonds
36. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
Journalizing
International Accounting Standards Board
Shares
Revenues
37. The principle prescribing that revenue is recognized when earned.
Revenue Recognition Principle
Current Assets
Account
Accounting Period
38. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Monetary Unit Assumption
Time Period Assumptions
Conceptual Framework
NASDAQ
39. Report of changes in equity over a period; adjusted for increases and for decreases.
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40. Business owned by two or more people.
Partnership
Risk
Internal users
Balance Sheet
41. List of accounts used by a company' includes and identification number for each account.
Contra Account
Revenues
Chart of Accounts
Risk
42. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Financial Accounting Standards Board
Temporary Accounts
SEC (Securites and Exchange Commision)
Current Liabilities
43. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Expense Recognition Principle
Limited Liability Corporation
Unsecured Loan
International Financial Reporting Standards
44. 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
IRA (Individual Retirement Account)
Sarbanes-Oxley Act (SOX)
Partnership
Cash Basis Accounting
45. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Unsecured Loan
Owner Investment
Post Closing Trial Balance
CD (Certificate of Deposit)
46. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Accounting Equation
Working Papers
Debt Ratio
Contra Account
47. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Liabilities
Source Documents
Work Sheet
Chart of Accounts
48. Record containing all accounts (with amounts) for a business.
Annual Financial Statements
Return on Assets
Ledger
Journal
49. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Debtors
Ponzi Scheme
Unadjusted Trial Balance
Return on Assets
50. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Deficit
Recordkeeping
Debtors
Pro Forma Financial Statement