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Test your basic knowledge |
DSST Principles Of Finance
Start Test
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. Uncertainty about expected return.
Depreciation
Limited Liability Corporation
Risk
Full Disclosure Principle
2. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Intangible assets
Unclassified Balance Sheets
Stock
Annual Financial Statements
3. Journal entry at the end of an accounting period to bring an asset or liability account to its proper amount and update the related expenses or revenue account.
Long Term Liabilities
Intangible assets
Accounting Equation
Adjusting Entry
4. The value of a future cash steam discounted at the appropriate market interest rate.
Unsecured Loan
Ethics
Present Value
Internal transactions
5. Process of recording transactions in a journal.
Cost Principle
Bailout
Journalizing
General Journal
6. Owner's claim on the assets of a business; equals the residual interest in an entity's assets after deducting liabilities. Also called net assets.
Owner Withdrawals
Equity
Accounting Equation
Post Closing Trial Balance
7. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Stockholders
Ponzi Scheme
Working Papers
Current Assets
8. Happenings that both affect an organization's financial position and can be reliably measured.
Reversing Entries
Equity
Events
Account Balance
9. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
Current Assets
Long Term Liabilities
Work Sheet
Straight-line Depreciation Method
10. A security representing partial ownership of the company. It gives the holer priority to dividends over common stock investors. Capital stock that provides a specific dividend - which is paid before any dividends are pai to common stock holders - an
Shareholders
Accrued Revenues
Preferred Stock
Acquisition
11. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Conceptual Framework
International Accounting Standards Board
Permanent Accounts
Cash Basis Accounting
12. A legal entity that is seperate from its owners.
Depreciation
Reversing Entries
Corporations
Debtors
13. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Securities and Exchange Commission
Ponzi Scheme
Return on Assets
SEC (Securites and Exchange Commision)
14. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Adjusted Trial Balance
Corporation
NASDAQ
Financial Accounting
15. Persons using accounting information who are not directly involved in running the organization.
External Users
Creditors
Current Assets
Compound Journal Entries
16. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Plant Assets
Bailout
Accrual Basis Accounting
Cost-benefit Constraint
17. Independent group of full-time members responsible for setting accounting rules.
Accrued Expenses
Financial Accounting Standards Board
Managerial Accounting
Sole Propietorship
18. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
CD (Certificate of Deposit)
Prepaid Expenses
Unsecured Loan
Fiscal Year
19. Statements that show the effect of proposed transactions and events as if they had occurred.
Pro Forma Financial Statement
Income Summary
Passive Income
Equity
20. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Reversing Entries
Time Period Assumptions
Owner - Capital
Current Liabilities
21. 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.
Bonds
Recordkeeping
Corporations
Unsecured Loan
22. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Balance Column Account
Materiality Constraint
Income Summary
Accounting Equation
23. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Account Balance
Going-concern Assumptions
Account
Accounting
24. Gross increase in equity from a company's business activities that earn income.
Closing Entries
Internal transactions
Discretionary Income
Revenues
25. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Revenue Recognition Principle
Internal users
Cost-benefit Constraint
Partnership Agreement
26. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Operating Cycle
Income Statement
Corporations
Shares
27. A tax deferred account that allows individuals to plan for their retirement.
Temporary Accounts
Internal transactions
Securities and Exchange Commission
IRA (Individual Retirement Account)
28. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Fixed Expense
Partnership Agreement
Varaiable Expense
Limited Liability Corporation
29. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Permanent Accounts
Current Ratio
Fixed Expense
Passive Income
30. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Internal transactions
Depreciation
Account
Source Documents
31. Persons using accounting information who are directly involved in managing the organization.
External Users
Internal users
Unearned Revenues
External Transactions
32. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.
Chart of Accounts
Fiscal Year
Unearned Revenue
Depreciation
33. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
General Journal
Closing process
Fixed Expense
Ethics
34. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Audit
Owner Withdrawals
Owner Investment
Bookkeeping
35. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Accounting Period
Pro Forma Financial Statement
Audit
Contra Account
36. All purpose journal for recording the debits and credits of transactions and events.
Double Entry Accounting
General Journal
Risk
IPO
37. An expense that changes from period to perio - such as food or gasoline costs.
IRA (Individual Retirement Account)
Long Term Liabilities
Varaiable Expense
Permanent Accounts
38. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Post Closing Trial Balance
T Account
CD (Certificate of Deposit)
Unearned Revenues
39. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.
Present Value
Limited Liability Corporation
IPO
Time Period Assumptions
40. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Deficit
Full Disclosure Principle
Preferred Stock
Posting
41. Tool used to show the effects of transactions and events on individual accounts.
External Transactions
T Account
Ethical Dilemma
Owner Withdrawals
42. Assets put into the business by the owner.
Limited Liability Corporation
Return on Assets
Owner Investment
Balance Column Account
43. The principle prescribing that revenue is recognized when earned.
Fixed Expense
Accounting Cycle
Work Sheet
Revenue Recognition Principle
44. Area of accounting aimed mainly at serving external users.
Partnership
Adjusted Trial Balance
Financial Accounting
Sole Proprietorship
45. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Present Value
Balance Column Account
Unearned Revenue
IPO
46. 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
Creditors
Depreciation
Present Value
NASDAQ
47. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Plant Assets
Financial Accounting
SEC (Securites and Exchange Commision)
Sole Proprietorship
48. Financial statement that subtracts expenses from revenues to yield a net income or loss over a specified period of time; also includes any gains or losses.
Federal Reserve System
Income Statement
Partnership
Book Value
49. A security representing a share of ownership in a company - providing voting rights - and entitling the holer to a share of the company's success through dividends and/or capital appreciation.
Common Stock
Revenues
Annual Financial Statements
External Users
50. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Debit
Auditors
NASDAQ
Unsecured Loan