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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. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Account Balance
Unsecured Loan
Monetary Unit Assumption
Working Papers
2. 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.
Expense Recognition Principle
Reversing Entries
Matching Principle
Current Ratio
3. 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.
Federal Reserve System
Accrued Revenues
Bonds
Liabilities
4. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Source Documents
Expense Recognition Principle
Assets
Risk Tolerance
5. The principle prescribing that revenue is recognized when earned.
Partnership Agreement
Statement of Owner's Equity
Return
Revenue Recognition Principle
6. 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.
Accrued Revenues
Cash Basis Accounting
Managerial Accounting
Ledger
7. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Return
Stock
Statement of Owner's Equity
Shareholders
8. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Equity
Unearned Revenues
Creditors
Long Term Investments
9. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Unsecured Loan
Pro Forma Financial Statement
Prepaid Expenses
Current Ratio
10. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Straight-line Depreciation Method
Unearned Revenue
Accrued Expenses
Current Ratio
11. All purpose journal for recording the debits and credits of transactions and events.
Accounting
Business Entity Assumption
General Journal
Securities and Exchange Commission
12. The first time a company sells shares of its stock to the public.
Monetary Unit Assumption
Conceptual Framework
IPO
Adjusting Entry
13. 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.
Adjusting Entry
Internal transactions
Internal users
Securities and Exchange Commission
14. List of accounts used by a company' includes and identification number for each account.
Net Loss
Monetary Unit Assumption
Chart of Accounts
Balance Sheet
15. Gross increase in equity from a company's business activities that earn income.
Profit Margin
Expenses
Accounting
Revenues
16. 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
SEC (Securites and Exchange Commision)
Accounting
Risk Tolerance
NASDAQ
17. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Contra Account
Accrual Basis Accounting
Journalizing
Annual Financial Statements
18. Happenings that both affect an organization's financial position and can be reliably measured.
Preferred Stock
Events
Time Period Assumptions
International Financial Reporting Standards
19. Activities within an organization that can affect the accounting equation.
Owner - Capital
Internal transactions
Long Term Liabilities
Annual Financial Statements
20. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Shares
Pro Forma Financial Statement
Ethical Dilemma
Materiality Constraint
21. Report of changes in equity over a period; adjusted for increases and for decreases.
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22. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Monetary Unit Assumption
Federal Reserve System
Money Market Account
Ponzi Scheme
23. An expense that changes from period to perio - such as food or gasoline costs.
Return
Varaiable Expense
Closing process
Surplus
24. Persons using accounting information who are directly involved in managing the organization.
Matching Principle
Income Summary
Account
Internal users
25. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Present Value
Generally Accepted Accounting Principles
Book Value
Journal
26. Individuals or organizations that owe money.
Debtors
Financial Accounting
Post Closing Trial Balance
Ethics
27. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Balance Sheet
Securities and Exchange Commission
Risk Tolerance
T Account
28. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
Stock
Work Sheet
General Journal
Deficit
29. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Current Assets
Closing Entries
Ethical Dilemma
Discretionary Income
30. Accounting information is based on cost with potential subsequent adjustments to fair value.
Unearned Revenue
Adjusted Trial Balance
Measurement Principle
Reversing Entries
31. Outflows or using up of assets as part of operations of business to generate sales.
Adjusting Entry
Money Market Account
Expenses
Closing process
32. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Working Papers
Monetary Unit Assumption
Conceptual Framework
Credit
33. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Expense Recognition Principle
Generally Accepted Accounting Principles
Accounting Cycle
Debit
34. 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.
International Financial Reporting Standards
Fixed Expense
Fiscal Year
Adjusted Trial Balance
35. Assets pulled out of the business by the owner.
Creditors
Owner Withdrawals
Ethical Dilemma
Long Term Liabilities
36. 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.
Ponzi Scheme
Return
Unearned Revenue
Compound Journal Entries
37. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Limited Liability Corporation
Business Entity Assumption
Profit Margin
Mergers
38. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Auditors
Depreciation
Full Disclosure Principle
Income Summary
39. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Balance Column Account
Unearned Revenue
Depreciation
CD (Certificate of Deposit)
40. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
SMART Goal
Chart of Accounts
Balance Sheet
Current Assets
41. The value of a future cash steam discounted at the appropriate market interest rate.
Corporations
Accounting
Account Balance
Present Value
42. A tax deferred account that allows individuals to plan for their retirement.
Bookkeeping
Chart of Accounts
Cash Basis Accounting
IRA (Individual Retirement Account)
43. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Expense Recognition Principle
Audit
Reversing Entries
Closing process
44. Expenses that remain the same regardless of the circumstances.
Varaiable Expense
Accrued Revenues
Fixed Expense
Temporary Accounts
45. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Pro Forma Financial Statement
Accounting
Temporary Accounts
Working Papers
46. Tool used to show the effects of transactions and events on individual accounts.
Audit
Money Market Account
Statement of Owner's Equity
T Account
47. 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
Plant Assets
IPO
Preferred Stock
Working Papers
48. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Accrued Revenues
Unadjusted Trial Balance
Fixed Expense
Debit
49. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
Risk Tolerance
Recordkeeping
Income Summary
International Accounting Standards Board
50. The money left over when income exceeds expenditure.
Auditors
International Accounting Standards Board
Straight-line Depreciation Method
Surplus