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DSST Principles Of Finance

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 within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.






2. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.






3. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.






4. 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.






5. Outflows or using up of assets as part of operations of business to generate sales.






6. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.






7. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.






8. 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.






9. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.






10. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.






11. Analysis and report of an organization's accounting system - its records - and its reports using various tests.






12. 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.






13. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.






14. Persons using accounting information who are directly involved in managing the organization.






15. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.






16. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.






17. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.






18. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.






19. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.






20. Rules that specify acceptable accounting practices.






21. A written framework to guide the development - preparation - and interpretation of financial accounting information.






22. Entries recorded at the end of each accounting period to transfer end of period balances in revenue - gain - expense - loss - and withdrawal (dividend for a corporation) accounts to the capital account (to retain earnings for a corporation).






23. Business owned by two or more people.






24. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.






25. Loaning or giving money to a business in orer to save it from bankruptcy.






26. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Matching Principle.






27. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.






28. Resources that a company owns or controls that are expected to provide current and future benefits to the business.






29. Excess of expenses over revenues for a period.






30. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.






31. Unincorporated association of two or more persons to pursue a business for profit as co-owners.






32. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.






33. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.






34. Record containing all accounts (with amounts) for a business.






35. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.






36. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.






37. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.






38. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.






39. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.






40. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.






41. Owners of a corporation who usually receive dividends. Also called stockholders.






42. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.






43. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.






44. Assets pulled out of the business by the owner.






45. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.






46. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.






47. 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






48. Tool used to show the effects of transactions and events on individual accounts.






49. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity






50. Area of accounting aimed mainly at serving external users.







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