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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. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Stock
Auditors
Prepaid Expenses
Federal Reserve System
2. 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
Common Stock
Profit Margin
Sarbanes-Oxley Act (SOX)
Revenue Recognition Principle
3. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Debit
Temporary Accounts
Statement of Cash Flows
Shares
4. Entries recorded at the end of each accounting period to transfer end of period balances in revenue - gain - expense - loss - and withdrawal (dividend for a corporation) accounts to the capital account (to retain earnings for a corporation).
Closing Entries
Debt Ratio
Ponzi Scheme
Expanded Accounting Equation
5. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Shares
Audit
Unclassified Balance Sheets
Debt Ratio
6. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Deficit
Owner Investment
Partnership
T Account
7. The first time a company sells shares of its stock to the public.
External Transactions
Full Disclosure Principle
IPO
Unclassified Balance Sheets
8. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Accounting
External Users
SEC (Securites and Exchange Commision)
Double Entry Accounting
9. Expenses that remain the same regardless of the circumstances.
Expense Recognition Principle
Expanded Accounting Equation
Fixed Expense
Expenses
10. The principle prescribing that revenue is recognized when earned.
Revenue Recognition Principle
Equity
Ledger
Risk Tolerance
11. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Return on Assets
Liabilities
T Account
SEC (Securites and Exchange Commision)
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.
Owner - Capital
Expanded Accounting Equation
Straight-line Depreciation Method
External Transactions
13. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Depreciation
Adjusting Entry
Permanent Accounts
IRA (Individual Retirement Account)
14. Independent group of full-time members responsible for setting accounting rules.
Account
Managerial Accounting
Financial Accounting Standards Board
Equity
15. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
General Journal
Surplus
Corporations
Account
16. Business owned by one person that is not organized as a corporation.
External Users
Sole Proprietorship
Compound Journal Entries
Post Closing Trial Balance
17. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
Business Entity Assumption
Debt Ratio
Unclassified Balance Sheets
International Accounting Standards Board
18. Outflows or using up of assets as part of operations of business to generate sales.
NASDAQ
Acquisition
Temporary Accounts
Expenses
19. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Annual Financial Statements
Matching Principle
Operating Cycle
Materiality Constraint
20. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Straight-line Depreciation Method
Securities
Corporations
Bailout
21. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Materiality Constraint
Conceptual Framework
Return on Assets
Portfolio Income
22. Length of time covered by financial statements; also called reporting period.
Long Term Investments
Recordkeeping
NASDAQ
Accounting Period
23. Business owned by two or more people.
Debit
SEC (Securites and Exchange Commision)
Partnership
Full Disclosure Principle
24. Business owned by a single person.
Unsecured Loan
General Journal
Sole Propietorship
Cash Basis Accounting
25. Record containing all accounts (with amounts) for a business.
Ledger
Bookkeeping
Current Assets
Working Papers
26. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenues
Ethics
Corporations
Current Ratio
27. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Accounting Period
Common Stock
Shareholders
Cash Basis Accounting
28. 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.
Closing process
Managerial Accounting
Portfolio Income
NYSE (New York Stock Exchange)
29. 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.
Ethics
Return on Assets
Accounting Equation
Bonds
30. Owners of a corporation who usually receive dividends. Also called shareholders.
Post Closing Trial Balance
Money Market Account
Income Statement
Stockholders
31. 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.
Matching Principle
Deficit
Interim Financial Statements
Securities and Exchange Commission
32. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Unsecured Loan
Assets
Unadjusted Trial Balance
Partnership Agreement
33. Monies (or sums of money) received from an investment; often in percent form.
Audit
Recordkeeping
Present Value
Return
34. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Closing process
Unadjusted Trial Balance
Cash Basis Accounting
Passive Income
35. 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
NYSE (New York Stock Exchange)
Preferred Stock
Natural Business Years
Accrued Expenses
36. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Balance Sheet
Securities and Exchange Commission
Unsecured Loan
Accounting Cycle
37. Individuals or organizations entitled to receive payments
Creditors
Business Entity Assumption
Account
Money Market Account
38. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Sole Propietorship
Journal
Securities
Post Closing Trial Balance
39. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Book Value
Measurement Principle
Expenses
Temporary Accounts
40. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Income Statement
Straight-line Depreciation Method
Materiality Constraint
Plant Assets
41. Excess of expenses over revenues for a period.
T Account
Shares
Net Loss
Shareholders
42. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
IPO
Unearned Revenue
Owner Withdrawals
Classified Balance Sheet
43. Persons using accounting information who are directly involved in managing the organization.
Internal users
Permanent Accounts
Internal transactions
Preferred Stock
44. Difference between total debits and total credits (including the beginning balance) for an account.
Events
Account Balance
Return
Shares
45. List of accounts used by a company' includes and identification number for each account.
Posting
Adjusted Trial Balance
Chart of Accounts
Time Period Assumptions
46. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.
Statement of Owner's Equity
Annual Financial Statements
Reversing Entries
Fixed Expense
47. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Adjusted Trial Balance
Bookkeeping
Double Entry Accounting
Statement of Owner's Equity
48. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Current Liabilities
Internal users
Ethics
Accounting Equation
49. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
External Users
Securities
Internal transactions
Book Value
50. Gross increase in equity from a company's business activities that earn income.
Limited Liability Corporation
Revenues
Mergers
Auditors