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Test your basic knowledge |
DSST Principles Of Finance
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Subjects
:
dsst
,
business-skills
Instructions:
Answer 50 questions in 15 minutes.
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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. Business owned by a single person.
Sole Propietorship
Stock
Conceptual Framework
Common Stock
2. Activities within an organization that can affect the accounting equation.
External Transactions
Creditors
Owner - Capital
Internal transactions
3. Income from investments - including dividends - interest - or the sale of a property.
Risk
Conceptual Framework
Owner Investment
Portfolio Income
4. Persons using accounting information who are directly involved in managing the organization.
Risk
Internal transactions
Internal users
Ponzi Scheme
5. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Cost Principle
Generally Accepted Accounting Principles
IPO
Time Period Assumptions
6. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
NASDAQ
Book Value
SEC (Securites and Exchange Commision)
Post Closing Trial Balance
7. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Present Value
Accounting Cycle
Materiality Constraint
Bookkeeping
8. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Prepaid Expenses
Current Ratio
Owner - Capital
Mergers
9. Accounting information is based on cost with potential subsequent adjustments to fair value.
Measurement Principle
Current Assets
Book Value
Mergers
10. 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.
Compound Journal Entries
Deficit
Conceptual Framework
Reversing Entries
11. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.
Present Value
Accrued Expenses
Credit
Closing process
12. Area of accounting aimed mainly at serving external users.
Financial Accounting
Long Term Investments
Owner - Capital
IPO
13. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Statement of Cash Flows
Discretionary Income
Closing Entries
Permanent Accounts
14. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Unsecured Loan
Partnership
Journal
Bonds
15. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Assets
Pro Forma Financial Statement
Financial Accounting
Straight-line Depreciation Method
16. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Double Entry Accounting
Operating Cycle
Cost-benefit Constraint
Present Value
17. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Double Entry Accounting
General Journal
Expanded Accounting Equation
Common Stock
18. Tool used to show the effects of transactions and events on individual accounts.
Passive Income
Posting Reference Column
T Account
Assets
19. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
International Accounting Standards Board
SEC (Securites and Exchange Commision)
Credit
Limited Liability Corporation
20. Persons using accounting information who are not directly involved in running the organization.
Internal transactions
Liabilities
External Users
Bonds
21. Assets put into the business by the owner.
Corporation
Posting Reference Column
Owner Investment
Secured Loan
22. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Events
Natural Business Years
Creditors
Accrual Basis Accounting
23. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Sole Propietorship
Bailout
Statement of Cash Flows
Recordkeeping
24. The twelve month period that ends when a company's sales activities are at their lowest point.
Secured Loan
Natural Business Years
Accounting Period
Depreciation
25. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Time Period Assumptions
Plant Assets
External Transactions
Matching Principle (or Expense Recognition Principle)
26. An expense that changes from period to perio - such as food or gasoline costs.
Revenue Recognition Principle
T Account
Varaiable Expense
Profit Margin
27. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Accrual Basis Accounting
Risk
Posting Reference Column
Contra Account
28. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Current Assets
International Accounting Standards Board
Common Stock
Depreciation
29. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Events
Matching Principle
Long Term Investments
Shares
30. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Common Stock
Internal transactions
Posting
Passive Income
31. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Financial Accounting Standards Board
Accounting
IRA (Individual Retirement Account)
Unsecured Loan
32. Individuals or organizations entitled to receive payments
Natural Business Years
Accounting
Net Income
Creditors
33. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Acquisition
Shares
Matching Principle (or Expense Recognition Principle)
External Users
34. Individuals or organizations that owe money.
Debtors
Securities
Fiscal Year
SMART Goal
35. A legal entity that is seperate from its owners.
Chart of Accounts
Corporations
Portfolio Income
Long Term Investments
36. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
Present Value
Balance Sheet
Auditors
Work Sheet
37. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Recordkeeping
Limited Liability Corporation
Current Assets
External Transactions
38. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Money Market Account
Debt Ratio
Long Term Investments
Accounting
39. Report of changes in equity over a period; adjusted for increases and for decreases.
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40. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.
Secured Loan
Bailout
Cost Principle
Shares
41. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Accrual Basis Accounting
Present Value
Permanent Accounts
Debtors
42. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Securities and Exchange Commission
Owner Investment
Trial balance
Balance Sheet
43. 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.
IRA (Individual Retirement Account)
Income Summary
Current Ratio
Federal Reserve System
44. 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.
Equity
Deficit
Expanded Accounting Equation
Long Term Investments
45. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Materiality Constraint
Conceptual Framework
Corporation
Reversing Entries
46. Income that is available after all of the essential financial commitments have been paid.
Bonds
Natural Business Years
Securities and Exchange Commission
Discretionary Income
47. All purpose journal for recording the debits and credits of transactions and events.
Sarbanes-Oxley Act (SOX)
General Journal
Current Ratio
Matching Principle (or Expense Recognition Principle)
48. The value of a future cash steam discounted at the appropriate market interest rate.
Chart of Accounts
Going-concern Assumptions
Present Value
Compound Journal Entries
49. Items paid for in advance of receiving their benefits. Classified as assets.
Temporary Accounts
Prepaid Expenses
Revenues
Posting Reference Column
50. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Sole Propietorship
Book Value
Credit
Income Statement
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