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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. Outflows or using up of assets as part of operations of business to generate sales.
T Account
Expenses
Partnership Agreement
Debt Ratio
2. Monies (or sums of money) received from an investment; often in percent form.
Revenues
Work Sheet
SEC (Securites and Exchange Commision)
Return
3. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Passive Income
Post Closing Trial Balance
Working Papers
Revenues
4. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Present Value
Assets
Accounting
Portfolio Income
5. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Passive Income
Partnership
Expanded Accounting Equation
Accounting
6. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.
Credit
Sole Propietorship
Preferred Stock
Matching Principle (or Expense Recognition Principle)
7. Expenses that remain the same regardless of the circumstances.
Income Statement
Accounting Period
Fixed Expense
Interim Financial Statements
8. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Accrual Basis Accounting
Return
Portfolio Income
International Financial Reporting Standards
9. Excess of expenses over revenues for a period.
Net Loss
Monetary Unit Assumption
Owner - Capital
Statement of Owner's Equity
10. 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.
Sole Proprietorship
NASDAQ
Ethics
Owner - Capital
11. Loaning or giving money to a business in orer to save it from bankruptcy.
Cash Basis Accounting
Bailout
Accounting Equation
Credit
12. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Temporary Accounts
Return
Accounting Cycle
Permanent Accounts
13. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Securities
Present Value
Materiality Constraint
Journal
14. 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.
Ponzi Scheme
Owner Investment
Acquisition
Accrued Expenses
15. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Straight-line Depreciation Method
Financial Accounting
Net Income
Owner Investment
16. A tax deferred account that allows individuals to plan for their retirement.
IRA (Individual Retirement Account)
Stock
Conceptual Framework
Annual Financial Statements
17. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.
Time Period Assumptions
Closing process
Straight-line Depreciation Method
Measurement Principle
18. 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.
Interim Financial Statements
Accrued Revenues
Natural Business Years
Securities and Exchange Commission
19. Business owned by two or more people.
Permanent Accounts
Expenses
Present Value
Partnership
20. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Closing process
Corporations
Unsecured Loan
Conceptual Framework
21. Statements that show the effect of proposed transactions and events as if they had occurred.
Pro Forma Financial Statement
Owner Withdrawals
Working Papers
Passive Income
22. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Risk
Partnership
Debtors
Money Market Account
23. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Debtors
Unearned Revenues
Passive Income
Accounting Cycle
24. The value of a future cash steam discounted at the appropriate market interest rate.
Stock
Conceptual Framework
SMART Goal
Present Value
25. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Debit
Monetary Unit Assumption
CD (Certificate of Deposit)
Passive Income
26. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Long Term Liabilities
Posting
Operating Cycle
International Accounting Standards Board
27. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Book Value
Intangible assets
SMART Goal
Adjusted Trial Balance
28. Principle that assumes transactions and events can be expressed in money units.
Monetary Unit Assumption
Current Ratio
Trial balance
Owner Withdrawals
29. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Revenues
Bookkeeping
Classified Balance Sheet
Reversing Entries
30. Assets put into the business by the owner.
Time Period Assumptions
Owner - Capital
Shareholders
Owner Investment
31. 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
Depreciation
Journal
Statement of Owner's Equity
Expanded Accounting Equation
32. Activities within an organization that can affect the accounting equation.
Operating Cycle
Going-concern Assumptions
Internal transactions
Balance Column Account
33. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Risk Tolerance
Equity
Current Liabilities
Monetary Unit Assumption
34. Goals that are specific - measurable - attainable - realistic - and time bound.
SMART Goal
Credit
Account
Internal users
35. The first time a company sells shares of its stock to the public.
Compound Journal Entries
IPO
T Account
Revenue Recognition Principle
36. Accounting information is based on cost with potential subsequent adjustments to fair value.
Owner Investment
Measurement Principle
Unadjusted Trial Balance
Business Entity Assumption
37. List of accounts and balances prepared before accounting adjustments are recorded and posted.
SMART Goal
Closing Entries
Depreciation
Unadjusted Trial Balance
38. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
SEC (Securites and Exchange Commision)
Bookkeeping
Interim Financial Statements
Closing process
39. All purpose journal for recording the debits and credits of transactions and events.
Intangible assets
General Journal
Chart of Accounts
Net Income
40. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Partnership
Matching Principle (or Expense Recognition Principle)
Surplus
Net Loss
41. Difference between total debits and total credits (including the beginning balance) for an account.
Account Balance
Trial balance
NYSE (New York Stock Exchange)
Double Entry Accounting
42. A security representing a share of ownership in a company - providing voting rights - and entitling the holer to a share of the company's success through dividends and/or capital appreciation.
Federal Reserve System
Common Stock
Plant Assets
Materiality Constraint
43. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Posting Reference Column
Unearned Revenue
Mergers
Current Assets
44. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Acquisition
Balance Column Account
Business Entity Assumption
Adjusting Entry
45. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.
Portfolio Income
Unearned Revenues
Risk Tolerance
Trial balance
46. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Managerial Accounting
Audit
Surplus
Ponzi Scheme
47. A loan that is backed by collateral such as cars - houses - or other assets.
Accrual Basis Accounting
Long Term Investments
Secured Loan
Account Balance
48. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Unsecured Loan
Fiscal Year
Materiality Constraint
Expense Recognition Principle
49. Individuals or organizations entitled to receive payments
Fiscal Year
Accrual Basis Accounting
Common Stock
Creditors
50. Gross increase in equity from a company's business activities that earn income.
Debit
Accounting
Revenues
Chart of Accounts