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






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






3. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.






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






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






7. Report of changes in equity over a period; adjusted for increases and for decreases.

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






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






10. Happenings that both affect an organization's financial position and can be reliably measured.






11. All purpose journal for recording the debits and credits of transactions and events.






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






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






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






15. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.






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






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






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






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






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






21. Journal entries that affect at least three accounts.






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






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






24. Individuals or organizations entitled to receive payments






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






26. Resources that a company owns or controls that are expected to provide current and future benefits to the business.






27. Area of accounting aimed mainly at serving the decision-making needs of internal users.






28. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.






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






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






31. Gross increase in equity from a company's business activities that earn income.






32. Business owned by two or more people.






33. 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.






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






35. 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.






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






37. 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.






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






39. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity






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






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






42. 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.






43. 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.






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






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






46. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.






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






48. Balance sheet that broadly groups assets - liabilities - and equity accounts.






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






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