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Test your basic knowledge |
DSST Principles Of Finance
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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 federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Source Documents
Expense Recognition Principle
IPO
SEC (Securites and Exchange Commision)
2. Statements that show the effect of proposed transactions and events as if they had occurred.
Conceptual Framework
Owner Withdrawals
Pro Forma Financial Statement
Financial Accounting
3. Journal entries that affect at least three accounts.
Matching Principle (or Expense Recognition Principle)
Compound Journal Entries
Creditors
Revenues
4. Accounting information is based on cost with potential subsequent adjustments to fair value.
Measurement Principle
Matching Principle (or Expense Recognition Principle)
Portfolio Income
Adjusting Entry
5. Gross increase in equity from a company's business activities that earn income.
International Accounting Standards Board
Bailout
Revenues
Matching Principle
6. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.
Net Income
Trial balance
Adjusted Trial Balance
Compound Journal Entries
7. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Unclassified Balance Sheets
Risk
Chart of Accounts
Accrual Basis Accounting
8. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Audit
Classified Balance Sheet
Matching Principle (or Expense Recognition Principle)
Accrual Basis Accounting
9. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Partnership Agreement
Accounting Period
Balance Column Account
Financial Accounting
10. Assets put into the business by the owner.
Income Summary
Surplus
Owner Investment
Working Papers
11. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Current Liabilities
Risk Tolerance
Internal users
External Transactions
12. The combining of two or more comapnies into one larger company.
International Accounting Standards Board
Shares
Mergers
Money Market Account
13. Persons using accounting information who are directly involved in managing the organization.
Owner - Capital
Internal users
NASDAQ
Matching Principle
14. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
Financial Accounting Standards Board
Securities and Exchange Commission
Cost-benefit Constraint
Federal Reserve System
15. The NYSE was founded in 1792 and is the oldest and larvest securities market in the United States. it is located on Wall Street in New York.
Income Statement
Financial Accounting Standards Board
NYSE (New York Stock Exchange)
Securities and Exchange Commission
16. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Cost Principle
Preferred Stock
Materiality Constraint
Monetary Unit Assumption
17. The money left over when income exceeds expenditure.
Surplus
Debt Ratio
Posting Reference Column
Debit
18. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Posting
Portfolio Income
Money Market Account
Sole Propietorship
19. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Plant Assets
Revenue Recognition Principle
Contra Account
Materiality Constraint
20. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Accounting Equation
Pro Forma Financial Statement
Shareholders
Temporary Accounts
21. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Contra Account
Accrual Basis Accounting
Temporary Accounts
Common Stock
22. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Monetary Unit Assumption
CD (Certificate of Deposit)
Temporary Accounts
Compound Journal Entries
23. Individuals or organizations that owe money.
Debtors
Equity
Risk
Liabilities
24. 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
Long Term Investments
Balance Column Account
Equity
25. Financial statement that subtracts expenses from revenues to yield a net income or loss over a specified period of time; also includes any gains or losses.
SMART Goal
Income Statement
Posting
Account
26. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Sole Proprietorship
Owner Investment
Unearned Revenue
Statement of Cash Flows
27. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Liabilities
Closing process
Book Value
Long Term Liabilities
28. Owners of a corporation who usually receive dividends. Also called shareholders.
Statement of Cash Flows
Working Papers
Stockholders
Revenue Recognition Principle
29. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Conceptual Framework
Stock
Matching Principle (or Expense Recognition Principle)
Present Value
30. A corporation's basic ownership share.
Common Stock
Internal users
Contra Account
Generally Accepted Accounting Principles
31. 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.
Accounting Period
Matching Principle
Permanent Accounts
Net Income
32. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.
Acquisition
Surplus
Managerial Accounting
Common Stock
33. Uncertainty about expected return.
NYSE (New York Stock Exchange)
Post Closing Trial Balance
Risk
Time Period Assumptions
34. 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.
International Financial Reporting Standards
Balance Sheet
Credit
Equity
35. Loaning or giving money to a business in orer to save it from bankruptcy.
T Account
Federal Reserve System
Book Value
Bailout
36. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.
Contra Account
Debt Ratio
Portfolio Income
Accrued Revenues
37. 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).
Unearned Revenue
Ponzi Scheme
Income Summary
Auditors
38. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Unearned Revenue
Bailout
Accounting Cycle
Account Balance
39. Independent group of full-time members responsible for setting accounting rules.
Revenue Recognition Principle
Statement of Cash Flows
Financial Accounting Standards Board
Accrual Basis Accounting
40. 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.
Present Value
Prepaid Expenses
Ponzi Scheme
Reversing Entries
41. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Partnership Agreement
Long Term Investments
Preferred Stock
Work Sheet
42. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Present Value
Bookkeeping
Temporary Accounts
Ponzi Scheme
43. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Recordkeeping
Current Liabilities
Unearned Revenue
Long Term Liabilities
44. A legal entity that is seperate from its owners.
Expense Recognition Principle
Corporations
Common Stock
IRA (Individual Retirement Account)
45. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Straight-line Depreciation Method
Recordkeeping
Book Value
Materiality Constraint
46. Happenings that both affect an organization's financial position and can be reliably measured.
IPO
Events
Accounting Equation
Going-concern Assumptions
47. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.
Time Period Assumptions
Owner - Capital
Limited Liability Corporation
Book Value
48. Report of changes in equity over a period; adjusted for increases and for decreases.
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49. The first time a company sells shares of its stock to the public.
Going-concern Assumptions
Permanent Accounts
Passive Income
IPO
50. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Financial Accounting Standards Board
Sarbanes-Oxley Act (SOX)
Full Disclosure Principle
Permanent Accounts