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






2. The twelve month period that ends when a company's sales activities are at their lowest point.






3. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.






4. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.






5. 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.






6. Report of changes in equity over a period; adjusted for increases and for decreases.

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7. Accounting information is based on cost with potential subsequent adjustments to fair value.






8. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.






9. The money left over when income exceeds expenditure.






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






11. 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.






12. Normal time between paying cash for merchandise or employee services and receiving cash from customers.






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






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






15. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.






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






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






18. Rules that specify acceptable accounting practices.






19. The central bank of the United States - with 12 Federal Reserve branch banks located in major cities throughout the nation. It helps to regulate the US monetary and banking system.






20. 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.






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






22. Excess of expenses over revenues for a period.






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






24. Length of time covered by financial statements; also called reporting period.






25. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.






26. A corporation's basic ownership share.






27. Gross increase in equity from a company's business activities that earn income.






28. 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






29. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.






30. Obligations not due to be paid within one year or the operating cycle - whichever is longer.






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






32. Happenings that both affect an organization's financial position and can be reliably measured.






33. 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.






34. All purpose journal for recording the debits and credits of transactions and events.






35. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.






36. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.






37. 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.






38. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.






39. List of accounts and balances prepared after period-end adjustments are recorded and posted.






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






41. Income that is available after all of the essential financial commitments have been paid.






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






43. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.






44. Area of accounting aimed mainly at serving the decision-making needs of internal users.






45. 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.






46. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.






47. Business owned by two or more people.






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






49. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.






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