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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. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Equity
Common Stock
Unearned Revenues
Current Liabilities
2. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Current Ratio
Current Assets
Accounting Equation
Adjusting Entry
3. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Risk Tolerance
Shareholders
NYSE (New York Stock Exchange)
Partnership Agreement
4. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Owner Investment
Deficit
Sole Proprietorship
Current Liabilities
5. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Limited Liability Corporation
CD (Certificate of Deposit)
Chart of Accounts
Measurement Principle
6. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Source Documents
Liabilities
Portfolio Income
Sole Proprietorship
7. 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.
IRA (Individual Retirement Account)
Common Stock
Events
Ethical Dilemma
8. Business owned by one person that is not organized as a corporation.
Long Term Liabilities
Working Papers
Expenses
Sole Proprietorship
9. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
Ethics
Securities and Exchange Commission
International Accounting Standards Board
Accrued Expenses
10. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Deficit
Debit
Debtors
Closing Entries
11. Uncertainty about expected return.
Fiscal Year
Posting Reference Column
Risk
Securities
12. Area of accounting aimed mainly at serving external users.
Ethics
Matching Principle (or Expense Recognition Principle)
Financial Accounting
CD (Certificate of Deposit)
13. Owners of a corporation who usually receive dividends. Also called stockholders.
Partnership
Compound Journal Entries
Current Assets
Shareholders
14. Expenses that remain the same regardless of the circumstances.
Financial Accounting
Fixed Expense
Source Documents
Posting
15. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Interim Financial Statements
Current Ratio
Full Disclosure Principle
IRA (Individual Retirement Account)
16. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Managerial Accounting
Unadjusted Trial Balance
Debtors
Compound Journal Entries
17. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Expanded Accounting Equation
Debit
Working Papers
Conceptual Framework
18. Individuals or organizations entitled to receive payments
Posting
Creditors
Stock
Expanded Accounting Equation
19. All purpose journal for recording the debits and credits of transactions and events.
General Journal
Time Period Assumptions
Stockholders
Account
20. Journal entries that affect at least three accounts.
Permanent Accounts
Securities and Exchange Commission
Compound Journal Entries
Conceptual Framework
21. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Unadjusted Trial Balance
NASDAQ
Common Stock
Annual Financial Statements
22. Monies (or sums of money) received from an investment; often in percent form.
Compound Journal Entries
Securities
Return
Source Documents
23. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Accounting Equation
Permanent Accounts
Monetary Unit Assumption
Auditors
24. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
International Financial Reporting Standards
Partnership
Posting
Cost-benefit Constraint
25. The twelve month period that ends when a company's sales activities are at their lowest point.
Natural Business Years
Book Value
Common Stock
Varaiable Expense
26. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Book Value
Events
Assets
Passive Income
27. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Expanded Accounting Equation
NYSE (New York Stock Exchange)
Cash Basis Accounting
Accounting Period
28. Assets put into the business by the owner.
Source Documents
Owner Investment
Debit
Conceptual Framework
29. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Adjusting Entry
NYSE (New York Stock Exchange)
Going-concern Assumptions
Ethics
30. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Conceptual Framework
Reversing Entries
Matching Principle
Financial Accounting
31. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Balance Column Account
Interim Financial Statements
Posting Reference Column
Post Closing Trial Balance
32. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Temporary Accounts
External Transactions
Adjusting Entry
Operating Cycle
33. A security representing partial ownership of the company. It gives the holer priority to dividends over common stock investors. Capital stock that provides a specific dividend - which is paid before any dividends are pai to common stock holders - an
Preferred Stock
IPO
Cost Principle
Source Documents
34. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Debit
Ethical Dilemma
NASDAQ
Pro Forma Financial Statement
35. 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.
Unearned Revenue
Debtors
Bonds
Long Term Investments
36. Income from investments - including dividends - interest - or the sale of a property.
Portfolio Income
Statement of Owner's Equity
Internal users
Acquisition
37. Report of changes in equity over a period; adjusted for increases and for decreases.
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38. The money left over when income exceeds expenditure.
Chart of Accounts
Money Market Account
Compound Journal Entries
Surplus
39. Difference between total debits and total credits (including the beginning balance) for an account.
Account
Common Stock
Partnership
Account Balance
40. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Surplus
Ethical Dilemma
Ponzi Scheme
Account
41. Business owned by a single person.
Debit
Sole Propietorship
Working Papers
Stockholders
42. Individuals or organizations that owe money.
Interim Financial Statements
Debtors
Corporations
Risk
43. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Internal users
Stock
Auditors
Matching Principle (or Expense Recognition Principle)
44. 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.
Permanent Accounts
Ponzi Scheme
Surplus
Accounting
45. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Unsecured Loan
Statement of Cash Flows
Deficit
Revenue Recognition Principle
46. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Fixed Expense
Bonds
Long Term Liabilities
Closing Entries
47. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Money Market Account
Auditors
Journal
Operating Cycle
48. Process of recording transactions in a journal.
Journalizing
Stock
Accounting Period
CD (Certificate of Deposit)
49. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.
Assets
Owner - Capital
Source Documents
Acquisition
50. 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.
Statement of Owner's Equity
Balance Sheet
Journal
Income Statement