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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. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Risk Tolerance
Trial balance
Straight-line Depreciation Method
Posting
2. Owners of a corporation who usually receive dividends. Also called shareholders.
Straight-line Depreciation Method
Stockholders
Ponzi Scheme
Working Papers
3. Process of recording transactions in a journal.
Stock
Journalizing
Source Documents
Surplus
4. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Current Ratio
Liabilities
T Account
Partnership
5. Record containing all accounts (with amounts) for a business.
Time Period Assumptions
Ledger
Creditors
Straight-line Depreciation Method
6. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Net Income
Partnership
Business Entity Assumption
Shares
7. 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.
Fiscal Year
SEC (Securites and Exchange Commision)
Expense Recognition Principle
Liabilities
8. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Stock
Preferred Stock
Cash Basis Accounting
Financial Accounting Standards Board
9. 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.
Journalizing
Materiality Constraint
Time Period Assumptions
Accrued Revenues
10. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Generally Accepted Accounting Principles
Surplus
Operating Cycle
CD (Certificate of Deposit)
11. Process of transferring journal entry information to the ledger; computerized systems automate this process.
T Account
Posting
Accrued Revenues
Preferred Stock
12. Report of changes in equity over a period; adjusted for increases and for decreases.
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13. Happenings that both affect an organization's financial position and can be reliably measured.
Events
Fixed Expense
Closing Entries
Portfolio Income
14. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Book Value
Passive Income
Sole Propietorship
IRA (Individual Retirement Account)
15. The principle prescribing that revenue is recognized when earned.
Stock
Revenue Recognition Principle
Permanent Accounts
Equity
16. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
CD (Certificate of Deposit)
Sarbanes-Oxley Act (SOX)
Accounting
Unclassified Balance Sheets
17. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Credit
IRA (Individual Retirement Account)
Matching Principle (or Expense Recognition Principle)
Unclassified Balance Sheets
18. All purpose journal for recording the debits and credits of transactions and events.
General Journal
Post Closing Trial Balance
Chart of Accounts
Limited Liability Corporation
19. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Unsecured Loan
Compound Journal Entries
Managerial Accounting
Plant Assets
20. 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.
Adjusting Entry
Revenue Recognition Principle
Common Stock
Work Sheet
21. An expense that changes from period to perio - such as food or gasoline costs.
Accrual Basis Accounting
Profit Margin
Varaiable Expense
Adjusting Entry
22. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Corporation
Annual Financial Statements
Account Balance
Accounting Equation
23. Tool used to show the effects of transactions and events on individual accounts.
Temporary Accounts
Fixed Expense
T Account
Reversing Entries
24. 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
Ethics
IRA (Individual Retirement Account)
Sarbanes-Oxley Act (SOX)
Federal Reserve System
25. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Balance Column Account
Shares
Time Period Assumptions
Going-concern Assumptions
26. Owners of a corporation who usually receive dividends. Also called stockholders.
Net Income
Cost Principle
Journal
Shareholders
27. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Deficit
Double Entry Accounting
Money Market Account
Income Statement
28. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.
Trial balance
Sole Propietorship
Journalizing
Credit
29. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Auditors
Generally Accepted Accounting Principles
Source Documents
Return
30. Rules that specify acceptable accounting practices.
Generally Accepted Accounting Principles
Fiscal Year
Managerial Accounting
Corporations
31. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Work Sheet
Cost-benefit Constraint
Accounting Period
Depreciation
32. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Securities
SMART Goal
Source Documents
Time Period Assumptions
33. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Long Term Liabilities
Ethical Dilemma
Source Documents
Operating Cycle
34. Loaning or giving money to a business in orer to save it from bankruptcy.
Measurement Principle
Bailout
Accounting Cycle
Common Stock
35. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Full Disclosure Principle
Pro Forma Financial Statement
Liabilities
Money Market Account
36. 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.
Equity
Bookkeeping
Matching Principle
Net Income
37. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Profit Margin
Owner - Capital
Credit
T Account
38. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Work Sheet
Going-concern Assumptions
Unearned Revenues
Varaiable Expense
39. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Managerial Accounting
Statement of Owner's Equity
Common Stock
Shares
40. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Materiality Constraint
Posting Reference Column
Cost Principle
Profit Margin
41. Exchanges of economic value between one entity and another entity.
Events
Accrual Basis Accounting
External Transactions
Statement of Cash Flows
42. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Net Loss
Partnership
Surplus
Source Documents
43. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Bailout
Interim Financial Statements
Posting
Accrued Expenses
44. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Expanded Accounting Equation
Creditors
Unsecured Loan
Ethical Dilemma
45. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Deficit
Classified Balance Sheet
Financial Accounting Standards Board
Audit
46. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Unsecured Loan
Limited Liability Corporation
Balance Sheet
Going-concern Assumptions
47. 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.
Reversing Entries
Securities and Exchange Commission
Balance Sheet
Monetary Unit Assumption
48. Individuals or organizations entitled to receive payments
SEC (Securites and Exchange Commision)
Internal users
Statement of Owner's Equity
Creditors
49. Business owned by a single person.
Matching Principle
Stockholders
Cost Principle
Sole Propietorship
50. 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
Ethical Dilemma
NASDAQ
Annual Financial Statements
Reversing Entries