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DSST Principles Of Finance
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Subjects
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dsst
,
business-skills
Instructions:
Answer 50 questions in 15 minutes.
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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. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Materiality Constraint
Audit
Pro Forma Financial Statement
Debit
2. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Risk
Business Entity Assumption
Financial Accounting
Time Period Assumptions
3. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.
Acquisition
Prepaid Expenses
Monetary Unit Assumption
Expenses
4. 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
Ponzi Scheme
International Financial Reporting Standards
Stock
NASDAQ
5. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Internal users
Full Disclosure Principle
Adjusted Trial Balance
Current Liabilities
6. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Contra Account
Full Disclosure Principle
Mergers
Creditors
7. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Working Papers
IRA (Individual Retirement Account)
Business Entity Assumption
Secured Loan
8. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Depreciation
Working Papers
Revenue Recognition Principle
Expanded Accounting Equation
9. Tool used to show the effects of transactions and events on individual accounts.
Auditors
Assets
Recordkeeping
T Account
10. Income that is available after all of the essential financial commitments have been paid.
Accounting
Secured Loan
NYSE (New York Stock Exchange)
Discretionary Income
11. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Long Term Liabilities
Accrued Revenues
Surplus
Partnership
12. Journal entries that affect at least three accounts.
Equity
General Journal
Compound Journal Entries
Natural Business Years
13. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Partnership Agreement
Risk Tolerance
Unsecured Loan
Portfolio Income
14. A legal entity that is seperate from its owners.
Income Summary
Accounting Period
Annual Financial Statements
Corporations
15. The twelve month period that ends when a company's sales activities are at their lowest point.
Partnership
Natural Business Years
Posting
Statement of Cash Flows
16. Activities within an organization that can affect the accounting equation.
Account Balance
Internal transactions
Long Term Liabilities
Income Statement
17. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Business Entity Assumption
Accounting Equation
Fixed Expense
Debtors
18. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
IPO
Unearned Revenue
Securities and Exchange Commission
Accrued Expenses
19. Process of recording transactions in a journal.
Journalizing
Adjusted Trial Balance
Straight-line Depreciation Method
Owner - Capital
20. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Profit Margin
Generally Accepted Accounting Principles
Closing Entries
Risk Tolerance
21. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Unsecured Loan
Going-concern Assumptions
Account
Current Assets
22. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Corporations
Unclassified Balance Sheets
Long Term Investments
Statement of Owner's Equity
23. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Statement of Cash Flows
Materiality Constraint
Equity
Sarbanes-Oxley Act (SOX)
24. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
General Journal
Permanent Accounts
Credit
Posting Reference Column
25. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Income Summary
Account Balance
Full Disclosure Principle
Limited Liability Corporation
26. A tax deferred account that allows individuals to plan for their retirement.
IRA (Individual Retirement Account)
Managerial Accounting
Accounting
Passive Income
27. Owners of a corporation who usually receive dividends. Also called stockholders.
Current Assets
Fiscal Year
Shareholders
Internal users
28. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.
Trial balance
Depreciation
Cash Basis Accounting
Corporation
29. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Posting Reference Column
Present Value
Securities and Exchange Commission
External Transactions
30. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.
Classified Balance Sheet
Income Statement
Risk Tolerance
Money Market Account
31. 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.
Surplus
International Financial Reporting Standards
Materiality Constraint
Adjusting Entry
32. 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.
Stock
Audit
Income Statement
Common Stock
33. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Book Value
Unearned Revenues
Partnership Agreement
Ethical Dilemma
34. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Common Stock
Debtors
Matching Principle (or Expense Recognition Principle)
Source Documents
35. Owners of a corporation who usually receive dividends. Also called shareholders.
Debit
Stockholders
Unearned Revenue
Unclassified Balance Sheets
36. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Bookkeeping
Business Entity Assumption
Accrued Revenues
Cost Principle
37. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Matching Principle
Contra Account
Audit
Federal Reserve System
38. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Partnership
Net Income
Long Term Liabilities
Fiscal Year
39. The combining of two or more comapnies into one larger company.
Secured Loan
Mergers
Securities and Exchange Commission
Return on Assets
40. 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
Plant Assets
Permanent Accounts
Expanded Accounting Equation
Current Liabilities
41. Exchanges of economic value between one entity and another entity.
Chart of Accounts
Corporation
External Transactions
External Users
42. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Expanded Accounting Equation
Depreciation
Stockholders
Temporary Accounts
43. List of accounts used by a company' includes and identification number for each account.
Sole Proprietorship
Chart of Accounts
Income Summary
Owner Investment
44. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.
Debtors
Operating Cycle
Risk
Debt Ratio
45. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Secured Loan
Audit
Securities
Ethics
46. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Events
IRA (Individual Retirement Account)
Permanent Accounts
Passive Income
47. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Intangible assets
Working Papers
Permanent Accounts
Source Documents
48. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Managerial Accounting
Discretionary Income
IPO
Annual Financial Statements
49. A corporation's basic ownership share.
Common Stock
IRA (Individual Retirement Account)
Recordkeeping
Profit Margin
50. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Owner - Capital
Long Term Investments
Account
Unsecured Loan
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