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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. Debt securities that are issued by a borrower to raise capital . Bonds guarantee payments of the original amount borrowe plus interest and/or repayable on a fixed rate when the bond matures.
Cost-benefit Constraint
Bonds
Common Stock
General Journal
2. A legal entity that is seperate from its owners.
Corporations
Accrual Basis Accounting
Corporation
Current Assets
3. The twelve month period that ends when a company's sales activities are at their lowest point.
Shares
Common Stock
Fixed Expense
Natural Business Years
4. Creditors' claims on an organization's assets; involves a probable future payment of assets - products - or services that a company is obligated to make due to past transactions or events.
Common Stock
Return
Plant Assets
Liabilities
5. The principle prescribing that revenue is recognized when earned.
Owner Withdrawals
Revenue Recognition Principle
Operating Cycle
Natural Business Years
6. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
Trial balance
Cost-benefit Constraint
Common Stock
Unearned Revenue
7. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Expenses
Profit Margin
Current Assets
Bookkeeping
8. A corporation's basic ownership share.
Current Assets
Posting Reference Column
Common Stock
Risk Tolerance
9. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.
Compound Journal Entries
Events
Ethical Dilemma
Fiscal Year
10. 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.
Materiality Constraint
Accounting Cycle
Adjusting Entry
Temporary Accounts
11. Individuals hired to review financial reports and information systems of organizations.
Auditors
Equity
Account
Matching Principle
12. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Posting
Bookkeeping
Managerial Accounting
Permanent Accounts
13. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Straight-line Depreciation Method
Matching Principle (or Expense Recognition Principle)
Balance Sheet
Unadjusted Trial Balance
14. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Unearned Revenue
Account
Return
Cost Principle
15. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.
Events
Sole Proprietorship
Stock
Annual Financial Statements
16. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Adjusted Trial Balance
NASDAQ
Accrued Expenses
Classified Balance Sheet
17. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Partnership
Pro Forma Financial Statement
Owner - Capital
Securities and Exchange Commission
18. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Varaiable Expense
Journal
Internal users
Shareholders
19. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Events
Assets
Bonds
Cash Basis Accounting
20. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Creditors
Financial Accounting
Statement of Cash Flows
Risk Tolerance
21. Business owned by two or more people.
Net Income
Partnership
Account Balance
Common Stock
22. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Temporary Accounts
Net Loss
Preferred Stock
Materiality Constraint
23. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Securities and Exchange Commission
Materiality Constraint
Return on Assets
Liabilities
24. Goals that are specific - measurable - attainable - realistic - and time bound.
SMART Goal
Common Stock
Recordkeeping
Equity
25. 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.
Interim Financial Statements
Common Stock
Partnership Agreement
Creditors
26. Income from investments - including dividends - interest - or the sale of a property.
International Accounting Standards Board
Portfolio Income
Credit
T Account
27. The money left over when income exceeds expenditure.
Mergers
Surplus
Measurement Principle
Partnership
28. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Classified Balance Sheet
Partnership Agreement
Income Statement
Posting
29. 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
Surplus
Sarbanes-Oxley Act (SOX)
Risk Tolerance
Assets
30. List of accounts and balances prepared before accounting adjustments are recorded and posted.
SMART Goal
Adjusted Trial Balance
Unadjusted Trial Balance
Work Sheet
31. The NYSE was founded in 1792 and is the oldest and larvest securities market in the United States. it is located on Wall Street in New York.
Internal users
NYSE (New York Stock Exchange)
Partnership
Post Closing Trial Balance
32. Assets put into the business by the owner.
Owner Investment
Interim Financial Statements
Time Period Assumptions
Shareholders
33. Journal entries that affect at least three accounts.
CD (Certificate of Deposit)
Account
Compound Journal Entries
Bonds
34. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Cost-benefit Constraint
Revenue Recognition Principle
Federal Reserve System
Unsecured Loan
35. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Federal Reserve System
Corporation
Bookkeeping
Depreciation
36. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Operating Cycle
Accounting Cycle
Assets
Unclassified Balance Sheets
37. Excess of expenses over revenues for a period.
Prepaid Expenses
Net Loss
Fixed Expense
Revenues
38. Area of accounting aimed mainly at serving external users.
Financial Accounting
Creditors
Return on Assets
Corporation
39. Monies (or sums of money) received from an investment; often in percent form.
Return
NYSE (New York Stock Exchange)
Fiscal Year
External Users
40. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Deficit
Assets
External Transactions
Financial Accounting
41. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Double Entry Accounting
Return
Ethics
Common Stock
42. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.
Cost Principle
Income Statement
Stock
Balance Sheet
43. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Source Documents
Current Liabilities
Partnership
International Financial Reporting Standards
44. Persons using accounting information who are not directly involved in running the organization.
External Users
Conceptual Framework
Prepaid Expenses
Accounting Cycle
45. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
External Users
Statement of Cash Flows
Book Value
Depreciation
46. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
Generally Accepted Accounting Principles
Stock
Working Papers
Work Sheet
47. Items paid for in advance of receiving their benefits. Classified as assets.
International Accounting Standards Board
Prepaid Expenses
Present Value
Contra Account
48. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Bailout
Securities and Exchange Commission
Straight-line Depreciation Method
Ethical Dilemma
49. The first time a company sells shares of its stock to the public.
Deficit
Accounting Equation
Permanent Accounts
IPO
50. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Fixed Expense
Present Value
Straight-line Depreciation Method
Current Ratio