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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. Process of transferring journal entry information to the ledger; computerized systems automate this process.






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






3. 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.






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






5. Balance sheet that broadly groups assets - liabilities - and equity accounts.






6. A loan that is backed by collateral such as cars - houses - or other assets.






7. Business owned by two or more people.






8. Items paid for in advance of receiving their benefits. Classified as assets.






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






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






11. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.






12. Persons using accounting information who are not directly involved in running the organization.






13. 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.






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






15. Individuals or organizations entitled to receive payments






16. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.






17. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.






18. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.






19. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.






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






21. Create the Public Company Accounting Oversight Board - regulates analyst conflicts - imposes corporate governance requirements - enhances accounting and control disclosures - impacts insider transactions and executive loans - establishes new types of






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






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






24. 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.






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






26. 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.






27. Owners of a corporation who usually receive dividends. Also called shareholders.






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






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






30. 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.






31. Difference between total debits and total credits (including the beginning balance) for an account.






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






33. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.






34. Independent group of full-time members responsible for setting accounting rules.






35. Principle that assumes transactions and events can be expressed in money units.






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






37. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.






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






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






40. 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.






41. The value of a future cash steam discounted at the appropriate market interest rate.






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






43. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.






44. The combining of two or more comapnies into one larger company.






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






46. A loan that is not backed by collateral - but by the promise of the borrower to repay it.






47. 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.






48. Monies (or sums of money) received from an investment; often in percent form.






49. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)






50. The money left over when income exceeds expenditure.