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






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






3. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.






4. A security representing a share of ownership in a company - providing voting rights - and entitling the holer to a share of the company's success through dividends and/or capital appreciation.






5. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.






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






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






8. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.






9. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.






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






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






12. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.






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






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






15. Assets put into the business by the owner.






16. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.






17. Assets = Liabilities + Equity; Equity equals [Owner capital - owner withdrawal + revenue - expenses] for a non-corporation; Equity equals [Contributed capital - retained earnings + revenue - expenses] for a corporation where dividends are subtracted






18. 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






19. Activities within an organization that can affect the accounting equation.






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






21. Business owned by two or more people.






22. 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.






23. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.






24. Length of time covered by financial statements; also called reporting period.






25. Business owned by a single person.






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






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






28. 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






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






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






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






32. 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.






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






34. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.






35. Financial statement that subtracts expenses from revenues to yield a net income or loss over a specified period of time; also includes any gains or losses.






36. List of accounts used by a company' includes and identification number for each account.






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






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






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






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






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






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






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






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






45. 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.






46. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.






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






48. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.






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






50. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.