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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. Tool used to show the effects of transactions and events on individual accounts.
T Account
Journalizing
Unclassified Balance Sheets
Classified Balance Sheet
2. 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.
Debit
Partnership
Events
Liabilities
3. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Unadjusted Trial Balance
Temporary Accounts
Managerial Accounting
Plant Assets
4. Persons using accounting information who are not directly involved in running the organization.
External Users
Accounting Period
Income Statement
Creditors
5. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
General Journal
Return
Chart of Accounts
Shares
6. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Net Income
Acquisition
Expanded Accounting Equation
Shareholders
7. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Securities
Money Market Account
Posting
Portfolio Income
8. Outflows or using up of assets as part of operations of business to generate sales.
Trial balance
Expenses
IPO
Unearned Revenues
9. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Unadjusted Trial Balance
Chart of Accounts
Accrual Basis Accounting
NYSE (New York Stock Exchange)
10. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Accrued Revenues
Cash Basis Accounting
Securities and Exchange Commission
Matching Principle (or Expense Recognition Principle)
11. Independent group of full-time members responsible for setting accounting rules.
Profit Margin
Expanded Accounting Equation
Chart of Accounts
Financial Accounting Standards Board
12. Assets put into the business by the owner.
Owner Investment
Debtors
Surplus
Recordkeeping
13. Business owned by one person that is not organized as a corporation.
Acquisition
Sole Proprietorship
Unsecured Loan
Source Documents
14. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Owner - Capital
Partnership
Deficit
Long Term Liabilities
15. Owners of a corporation who usually receive dividends. Also called shareholders.
Stockholders
Ponzi Scheme
Matching Principle
Prepaid Expenses
16. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Depreciation
Conceptual Framework
Liabilities
Events
17. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Monetary Unit Assumption
Income Summary
Corporation
Prepaid Expenses
18. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
Accrued Expenses
Risk Tolerance
Varaiable Expense
Conceptual Framework
19. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Book Value
Chart of Accounts
NASDAQ
Ledger
20. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Portfolio Income
Posting Reference Column
Temporary Accounts
Working Papers
21. A corporation's basic ownership share.
Closing Entries
Operating Cycle
Debtors
Common Stock
22. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Temporary Accounts
CD (Certificate of Deposit)
Net Income
Present Value
23. 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
Sarbanes-Oxley Act (SOX)
Accounting
Matching Principle
Partnership
24. Record containing all accounts (with amounts) for a business.
Ledger
Straight-line Depreciation Method
Owner Investment
Bookkeeping
25. 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.
Shareholders
Unearned Revenues
Limited Liability Corporation
Expense Recognition Principle
26. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Risk Tolerance
Matching Principle
Financial Accounting
Events
27. Length of time covered by financial statements; also called reporting period.
Current Assets
Accounting Period
Owner Withdrawals
Creditors
28. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Expense Recognition Principle.
Natural Business Years
Matching Principle
Account
Accounting Period
29. 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
Debt Ratio
Prepaid Expenses
NASDAQ
Unadjusted Trial Balance
30. 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.
International Financial Reporting Standards
Prepaid Expenses
Federal Reserve System
Income Summary
31. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Pro Forma Financial Statement
Adjusted Trial Balance
SEC (Securites and Exchange Commision)
Business Entity Assumption
32. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Intangible assets
Assets
Time Period Assumptions
Unearned Revenue
33. A loan that is backed by collateral such as cars - houses - or other assets.
Ethical Dilemma
Unearned Revenue
Current Liabilities
Secured Loan
34. Account showing the owner's claim on company assets; equals owner investments plus net income (or less net loss) minus owner withdrawals since the company's inception. Also called Equity.
Unsecured Loan
Owner - Capital
Bonds
Measurement Principle
35. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
Accrued Revenues
Ethics
Cost-benefit Constraint
Book Value
36. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
CD (Certificate of Deposit)
Accounting Cycle
Classified Balance Sheet
Time Period Assumptions
37. Individuals hired to review financial reports and information systems of organizations.
SMART Goal
Time Period Assumptions
Auditors
Revenue Recognition Principle
38. 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
Expanded Accounting Equation
SMART Goal
Net Income
Matching Principle (or Expense Recognition Principle)
39. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Bookkeeping
Net Income
Annual Financial Statements
Accounting Period
40. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Managerial Accounting
Common Stock
Income Summary
Statement of Cash Flows
41. The principle prescribing that revenue is recognized when earned.
Accounting Equation
Revenue Recognition Principle
Owner Withdrawals
Statement of Cash Flows
42. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Time Period Assumptions
Going-concern Assumptions
Limited Liability Corporation
Mergers
43. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Prepaid Expenses
Fixed Expense
Depreciation
Income Statement
44. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.
Sarbanes-Oxley Act (SOX)
Adjusted Trial Balance
Work Sheet
Intangible assets
45. Uncertainty about expected return.
Sole Propietorship
Common Stock
Risk
CD (Certificate of Deposit)
46. Excess of expenses over revenues for a period.
Financial Accounting Standards Board
Passive Income
Net Loss
General Journal
47. Temporary account used only in the closing process to which the balances of revenue and expense accounts (including any gains or losses) are transferred. Its balance is transferred to the capital account (or retained earnings for a corporation).
Profit Margin
Portfolio Income
Source Documents
Income Summary
48. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
External Transactions
Double Entry Accounting
Journal
Cash Basis Accounting
49. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Common Stock
Financial Accounting Standards Board
Corporations
Accrual Basis Accounting
50. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Passive Income
Permanent Accounts
Unearned Revenue
Measurement Principle