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Test your basic knowledge |
DSST Principles Of Finance
Start Test
Study First
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. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Partnership
Securities and Exchange Commission
Posting Reference Column
Recordkeeping
2. 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
Common Stock
Interim Financial Statements
Internal transactions
Preferred Stock
3. Journal entry at the end of an accounting period to bring an asset or liability account to its proper amount and update the related expenses or revenue account.
Recordkeeping
Adjusting Entry
Monetary Unit Assumption
Pro Forma Financial Statement
4. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Permanent Accounts
Internal transactions
Current Assets
Income Statement
5. Persons using accounting information who are not directly involved in running the organization.
Limited Liability Corporation
External Users
Contra Account
Surplus
6. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Internal users
Adjusted Trial Balance
Unearned Revenues
Balance Column Account
7. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Posting Reference Column
Debtors
Conceptual Framework
Full Disclosure Principle
8. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Bookkeeping
Return
Conceptual Framework
Present Value
9. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Accounting
Risk Tolerance
Account Balance
International Financial Reporting Standards
10. Loaning or giving money to a business in orer to save it from bankruptcy.
Corporations
Bailout
Long Term Investments
Contra Account
11. Uncertainty about expected return.
Compound Journal Entries
Ledger
Risk
SEC (Securites and Exchange Commision)
12. Activities within an organization that can affect the accounting equation.
Internal transactions
Debit
Sole Propietorship
Time Period Assumptions
13. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Surplus
Current Assets
Unclassified Balance Sheets
Source Documents
14. Length of time covered by financial statements; also called reporting period.
Expenses
Net Income
Accounting Period
Owner - Capital
15. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Risk Tolerance
Accounting Equation
NASDAQ
Journal
16. Journal entries that affect at least three accounts.
Annual Financial Statements
Compound Journal Entries
Sole Proprietorship
Cost-benefit Constraint
17. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Balance Column Account
Income Statement
Materiality Constraint
Monetary Unit Assumption
18. 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.
Matching Principle
Compound Journal Entries
Internal transactions
Owner Withdrawals
19. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
Journalizing
Ethics
Adjusted Trial Balance
Accounting Cycle
20. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Surplus
Auditors
Closing Entries
Double Entry Accounting
21. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Unearned Revenues
Partnership
Statement of Cash Flows
Net Income
22. The value of a future cash steam discounted at the appropriate market interest rate.
Measurement Principle
Present Value
Passive Income
Post Closing Trial Balance
23. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Matching Principle (or Expense Recognition Principle)
Bookkeeping
Matching Principle
Balance Column Account
24. Statements that show the effect of proposed transactions and events as if they had occurred.
Pro Forma Financial Statement
Passive Income
Mergers
Equity
25. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Passive Income
Measurement Principle
Generally Accepted Accounting Principles
Stock
26. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Depreciation
Working Papers
Net Income
Internal users
27. An acronym for the National Association of Securities Dealers Automated Quotations. NASDAQ was founded in 1970 and is the largest electronic stock exchange in the United States. Unlike the NYSE - it has no physical location - existing entirely on cyb
Revenues
Financial Accounting Standards Board
Statement of Cash Flows
NASDAQ
28. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Matching Principle
Profit Margin
Securities and Exchange Commission
Time Period Assumptions
29. A tax deferred account that allows individuals to plan for their retirement.
IRA (Individual Retirement Account)
Closing process
Work Sheet
Varaiable Expense
30. Income that is available after all of the essential financial commitments have been paid.
Interim Financial Statements
Discretionary Income
Sole Propietorship
Partnership
31. 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.
Internal transactions
Owner - Capital
Cash Basis Accounting
Money Market Account
32. An expense that changes from period to perio - such as food or gasoline costs.
Secured Loan
Corporation
Owner Investment
Varaiable Expense
33. Gross increase in equity from a company's business activities that earn income.
Partnership
Posting Reference Column
Expense Recognition Principle
Revenues
34. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Natural Business Years
Adjusted Trial Balance
SEC (Securites and Exchange Commision)
Ethical Dilemma
35. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Cost Principle
Current Liabilities
Surplus
Adjusted Trial Balance
36. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Cash Basis Accounting
Statement of Cash Flows
Journal
Securities and Exchange Commission
37. Accounting information is based on cost with potential subsequent adjustments to fair value.
Cash Basis Accounting
Deficit
Measurement Principle
Risk
38. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenue
Income Statement
Measurement Principle
Limited Liability Corporation
39. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Compound Journal Entries
Sarbanes-Oxley Act (SOX)
Time Period Assumptions
Double Entry Accounting
40. Expenses that remain the same regardless of the circumstances.
Unclassified Balance Sheets
Auditors
Fixed Expense
Unearned Revenue
41. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Double Entry Accounting
Equity
Deficit
Revenues
42. Owners of a corporation who usually receive dividends. Also called shareholders.
Stockholders
Going-concern Assumptions
Matching Principle (or Expense Recognition Principle)
Owner - Capital
43. Assets pulled out of the business by the owner.
Unearned Revenue
SEC (Securites and Exchange Commision)
Preferred Stock
Owner Withdrawals
44. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Equity
Source Documents
Adjusted Trial Balance
Stock
45. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Securities and Exchange Commission
Deficit
Plant Assets
Stockholders
46. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Audit
Shareholders
Reversing Entries
Accounting Equation
47. Rules that specify acceptable accounting practices.
Generally Accepted Accounting Principles
T Account
Depreciation
Adjusting Entry
48. The first time a company sells shares of its stock to the public.
Trial balance
Owner Withdrawals
Classified Balance Sheet
IPO
49. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Surplus
Balance Sheet
Partnership
Going-concern Assumptions
50. Owners of a corporation who usually receive dividends. Also called stockholders.
Accrued Expenses
Shareholders
Corporations
Liabilities