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






2. 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.






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






4. Expenses that remain the same regardless of the circumstances.






5. An expense that changes from period to perio - such as food or gasoline costs.






6. Business owned by a single person.






7. Individuals or organizations entitled to receive payments






8. The first time a company sells shares of its stock to the public.






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






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.






11. List of accounts and balances prepared before accounting adjustments are recorded and posted.






12. 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.






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






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






15. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.






16. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.






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






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






19. Statements that show the effect of proposed transactions and events as if they had occurred.






20. 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.






21. The principle prescribing that revenue is recognized when earned.






22. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity






23. 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.






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






25. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.






26. Persons using accounting information who are directly involved in managing the organization.






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






28. 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






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






30. The combining of two or more comapnies into one larger company.






31. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.






32. 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






33. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.






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






35. Journal entries that affect at least three accounts.






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






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






38. Persons using accounting information who are not directly involved in running the organization.






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






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






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






42. 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.






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






44. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.






45. 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






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






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






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






49. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.






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