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Test your basic knowledge |
DSST Principles Of Finance
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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. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Audit
Shares
Debtors
Temporary Accounts
2. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Corporation
Return on Assets
Depreciation
Sarbanes-Oxley Act (SOX)
3. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Auditors
Creditors
Full Disclosure Principle
Closing Entries
4. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
IPO
General Journal
Net Income
Passive Income
5. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Limited Liability Corporation
Bookkeeping
Revenues
Accounting
6. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Deficit
Internal users
Adjusted Trial Balance
Assets
7. The value of a future cash steam discounted at the appropriate market interest rate.
Acquisition
Accrual Basis Accounting
Accounting Equation
Present Value
8. 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
Long Term Investments
Limited Liability Corporation
Journalizing
Preferred Stock
9. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.
Account
Net Loss
Closing process
Accounting
10. Expenses that remain the same regardless of the circumstances.
Assets
Account Balance
Fixed Expense
Expenses
11. Monies (or sums of money) received from an investment; often in percent form.
Return
Going-concern Assumptions
Money Market Account
SEC (Securites and Exchange Commision)
12. 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
Surplus
NASDAQ
SEC (Securites and Exchange Commision)
Contra Account
13. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Materiality Constraint
Accounting Period
Contra Account
Acquisition
14. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.
Debt Ratio
Balance Column Account
Double Entry Accounting
Unearned Revenues
15. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Debt Ratio
Current Assets
Adjusting Entry
Owner Withdrawals
16. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Interim Financial Statements
Stockholders
Expense Recognition Principle
Shares
17. 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
Long Term Investments
Full Disclosure Principle
Managerial Accounting
Sarbanes-Oxley Act (SOX)
18. 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.
Bonds
Unearned Revenues
Income Summary
Working Papers
19. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Working Papers
Debt Ratio
Monetary Unit Assumption
Business Entity Assumption
20. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Stockholders
Bookkeeping
Current Liabilities
Annual Financial Statements
21. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Debit
Profit Margin
Credit
Operating Cycle
22. List of accounts used by a company' includes and identification number for each account.
Pro Forma Financial Statement
Auditors
Chart of Accounts
Creditors
23. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
T Account
Bookkeeping
Accrued Revenues
Unearned Revenue
24. All purpose journal for recording the debits and credits of transactions and events.
General Journal
Annual Financial Statements
Securities
Matching Principle
25. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Statement of Cash Flows
IRA (Individual Retirement Account)
Posting Reference Column
Matching Principle (or Expense Recognition Principle)
26. Persons using accounting information who are directly involved in managing the organization.
Shares
Internal users
Expense Recognition Principle
Intangible assets
27. Area of accounting aimed mainly at serving external users.
Financial Accounting
Varaiable Expense
Ledger
International Financial Reporting Standards
28. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
IPO
Corporation
Owner Withdrawals
Accounting Cycle
29. Persons using accounting information who are not directly involved in running the organization.
External Users
Income Statement
Monetary Unit Assumption
SMART Goal
30. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.
Time Period Assumptions
Partnership
Revenue Recognition Principle
Account Balance
31. A corporation's basic ownership share.
Shares
Common Stock
Fiscal Year
Long Term Liabilities
32. Rules that specify acceptable accounting practices.
NYSE (New York Stock Exchange)
Acquisition
Generally Accepted Accounting Principles
Straight-line Depreciation Method
33. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Statement of Owner's Equity
Revenue Recognition Principle
Passive Income
Closing process
34. 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.
NYSE (New York Stock Exchange)
Financial Accounting Standards Board
Reversing Entries
Post Closing Trial Balance
35. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
Sarbanes-Oxley Act (SOX)
Cost-benefit Constraint
Portfolio Income
Expense Recognition Principle
36. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Limited Liability Corporation
SEC (Securites and Exchange Commision)
Going-concern Assumptions
Debtors
37. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Securities and Exchange Commission
Permanent Accounts
Pro Forma Financial Statement
Accrued Expenses
38. Exchanges of economic value between one entity and another entity.
External Transactions
Ledger
Matching Principle
Post Closing Trial Balance
39. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Monetary Unit Assumption
Partnership Agreement
Risk
Acquisition
40. Report of changes in equity over a period; adjusted for increases and for decreases.
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41. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Unsecured Loan
Securities
Cash Basis Accounting
Revenues
42. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
SEC (Securites and Exchange Commision)
Profit Margin
Unearned Revenues
Ethics
43. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
IRA (Individual Retirement Account)
Audit
Bailout
Risk Tolerance
44. 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.
Corporation
Cost Principle
International Financial Reporting Standards
CD (Certificate of Deposit)
45. The money left over when income exceeds expenditure.
Surplus
Fixed Expense
Current Ratio
Debit
46. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.
Accrued Revenues
General Journal
Credit
Monetary Unit Assumption
47. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Debtors
Unearned Revenue
Unearned Revenues
Double Entry Accounting
48. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Accounting Equation
Shares
Unearned Revenues
Return
49. Independent group of full-time members responsible for setting accounting rules.
Shareholders
Financial Accounting Standards Board
Expanded Accounting Equation
Accrued Revenues
50. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Time Period Assumptions
Accounting Period
Source Documents
Portfolio Income