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






2. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.






3. The twelve month period that ends when a company's sales activities are at their lowest point.






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






5. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.






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






7. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.






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






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






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






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






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






13. 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.






14. Assets put into the business by the owner.






15. Business owned by two or more people.






16. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.






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






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






19. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.






20. The value of a future cash steam discounted at the appropriate market interest rate.






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






22. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.






23. 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.






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






25. Individuals or organizations entitled to receive payments






26. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.






27. Items paid for in advance of receiving their benefits. Classified as assets.






28. 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.






29. Journal entries that affect at least three accounts.






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






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






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






33. 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.






34. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.






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






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






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






38. Difference between total debits and total credits (including the beginning balance) for an account.






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






40. Accounting standards set by the IASB which aim to develop a single set of global standards - to promote those standards - and converge national and international standards globally.






41. Exchanges of economic value between one entity and another entity.






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






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






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






45. An expense that changes from period to perio - such as food or gasoline costs.






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






47. Revenues earned in a period that both unrecorded and not yet received in cash (or other assets; adjusting entries for recording accrued revenues involve increasing assets and increasing revenues.






48. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.






49. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.






50. Persons using accounting information who are directly involved in managing the organization.