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






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






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






4. A legal entity that is seperate from its owners.






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






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






7. 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.






8. 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.






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






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






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






12. Owner's claim on the assets of a business; equals the residual interest in an entity's assets after deducting liabilities. Also called net assets.






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






14. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.






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






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






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






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






19. 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).






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






21. Amount earned after subtracting all expenses necessary for and matched with sales for a period.






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






23. 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.






24. The money left over when income exceeds expenditure.






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






26. Individuals or organizations that owe money.






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






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






29. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.






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






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






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






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






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






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






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






37. Uncertainty about expected return.






38. Individuals hired to review financial reports and information systems of organizations.






39. A tax deferred account that allows individuals to plan for their retirement.






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






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






42. 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






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






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






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






46. Income from investments - including dividends - interest - or the sale of a property.






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






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






49. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.






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