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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. Record containing all accounts (with amounts) for a business.
Journal
Ledger
Expenses
Preferred Stock
2. The first time a company sells shares of its stock to the public.
IPO
Generally Accepted Accounting Principles
Stockholders
Preferred Stock
3. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Deficit
T Account
Temporary Accounts
Conceptual Framework
4. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Time Period Assumptions
Classified Balance Sheet
Contra Account
Interim Financial Statements
5. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Plant Assets
Unclassified Balance Sheets
Going-concern Assumptions
Balance Sheet
6. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Business Entity Assumption
Financial Accounting
Cash Basis Accounting
Owner - Capital
7. Excess of expenses over revenues for a period.
Account
Reversing Entries
Materiality Constraint
Net Loss
8. A legal entity that is seperate from its owners.
Owner - Capital
Accounting Cycle
Expense Recognition Principle
Corporations
9. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.
Expenses
General Journal
Closing process
Federal Reserve System
10. Length of time covered by financial statements; also called reporting period.
International Accounting Standards Board
Accounting Period
Cost Principle
Account Balance
11. The principle prescribing that revenue is recognized when earned.
Revenue Recognition Principle
Bonds
Account
Posting
12. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenues
Discretionary Income
Compound Journal Entries
Monetary Unit Assumption
13. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Source Documents
Conceptual Framework
Equity
NYSE (New York Stock Exchange)
14. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Business Entity Assumption
T Account
SMART Goal
Book Value
15. Persons using accounting information who are directly involved in managing the organization.
Internal users
Present Value
Time Period Assumptions
Financial Accounting
16. An expense that changes from period to perio - such as food or gasoline costs.
Varaiable Expense
Accounting Cycle
Adjusted Trial Balance
External Transactions
17. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Account
Profit Margin
Return on Assets
Unadjusted Trial Balance
18. 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.
Compound Journal Entries
Owner - Capital
Accrual Basis Accounting
International Financial Reporting Standards
19. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Account Balance
Risk Tolerance
Fixed Expense
Expense Recognition Principle
20. 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.
Accrued Revenues
Surplus
Limited Liability Corporation
Stockholders
21. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Accounting Cycle
Events
Long Term Investments
Unearned Revenues
22. 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.
Liabilities
Business Entity Assumption
Accounting Period
Journalizing
23. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Temporary Accounts
Book Value
Liabilities
Account
24. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Creditors
Auditors
Statement of Cash Flows
Posting
25. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Classified Balance Sheet
Managerial Accounting
Return on Assets
Net Income
26. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Posting
Recordkeeping
Permanent Accounts
Natural Business Years
27. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Deficit
Money Market Account
Securities
Post Closing Trial Balance
28. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
T Account
Journal
Debtors
Account
29. 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.
Expense Recognition Principle
Reversing Entries
Bonds
Balance Sheet
30. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Net Loss
Limited Liability Corporation
Return on Assets
Journalizing
31. The money left over when income exceeds expenditure.
Revenue Recognition Principle
Permanent Accounts
Posting Reference Column
Surplus
32. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Bookkeeping
Revenue Recognition Principle
External Users
Acquisition
33. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Unadjusted Trial Balance
Corporation
Partnership
Money Market Account
34. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Closing Entries
Trial balance
Annual Financial Statements
Unclassified Balance Sheets
35. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Debit
Debt Ratio
Income Statement
Cash Basis Accounting
36. Individuals or organizations that owe money.
Securities
Partnership
Accounting
Debtors
37. Uncertainty about expected return.
Closing Entries
Partnership
Risk
Sole Proprietorship
38. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Long Term Liabilities
Pro Forma Financial Statement
Unearned Revenues
Monetary Unit Assumption
39. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Current Liabilities
Post Closing Trial Balance
Unearned Revenue
Classified Balance Sheet
40. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Passive Income
Unearned Revenue
Owner Withdrawals
Owner - Capital
41. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Balance Sheet
Shares
T Account
Fiscal Year
42. The value of a future cash steam discounted at the appropriate market interest rate.
Accrued Expenses
Owner Withdrawals
Present Value
Journalizing
43. Owners of a corporation who usually receive dividends. Also called shareholders.
Prepaid Expenses
Owner Investment
Stockholders
Financial Accounting Standards Board
44. Assets put into the business by the owner.
Owner Investment
Trial balance
Ethical Dilemma
Temporary Accounts
45. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
Ethics
Intangible assets
Matching Principle
Net Income
46. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Fiscal Year
Creditors
Balance Sheet
Double Entry Accounting
47. 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.
Pro Forma Financial Statement
Unearned Revenue
Risk
Bonds
48. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Post Closing Trial Balance
Natural Business Years
SEC (Securites and Exchange Commision)
Operating Cycle
49. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.
Matching Principle
Intangible assets
Journalizing
Internal transactions
50. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
External Transactions
Bookkeeping
Current Assets
Balance Sheet