SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Search
Test your basic knowledge |
Business Accounting Basics
Start Test
Study First
Subject
:
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. 7th step of Accounting Cycle
longterm liabilities
wages payable - utilities payable - interest payable - unearned revenue - note payable
prepare adjusted trial balance
Credit balance - income statement - temporary - revenues
2. Reliability
Assets= Liabilities+Owners Equity<Contributed Capital><Retained Earnings-Revenues - Expenses>
companies must reduce the value of land - if the value is lower than its original cost.
credit balance - income statement - temporary - Revenue
the original amount to purchase land is verifiable through the contract documents
3. Dividends
Debit Balance - Retained Earnings - Temporary - Owners Equity
wages payable - utilities payable - interest payable - unearned revenue - note payable
Debit Balance - Income Statement - Temporary - expense
debit balance - Balance sheet - permanent - asset
4. Calculating Interest Formula
record adjusting entries to general journal
analyze transactions from external events
Payment x Rate x Time
Credit balance - Balance sheet and Retained Earnings - Permanent
5. 2nd step of Accounting Cycle
debit balance - balance sheet - permanent - asset
debit balance - Balance sheet - permanent - asset
Sales Revenues
record transactions in general journal
6. 4th step of analyzing transactions
does the equation remain in balance?
record assets of cost paid to acquire them - continue to value assets at historical cost until sold - more objective than market cost.
to those willing to take time to understand it
copyright - long term assets - noncurrent
7. Current Assets
Cash - Accounts recievable - supplies - inventory - prepaid rent - equipment - accumulated depreciation - goodwill - investments
(cash - accts revievable - inventory) turn into cash within 12 months
debit balance - Balance sheet - permanent - asset
Contributed Capital - Retained Earnings - Dividends
8. Conservatism
Net Income/Sales
prepare post-closing trial balance
companies must reduce the value of land - if the value is lower than its original cost.
the original amount to purchase land is verifiable through the contract documents
9. Unearned revenue
decrease equity - debit balance
Assets= Liabilities+Owners Equity<Contributed Capital><Retained Earnings-Revenues - Expenses>
credit balance - balance sheet - permanent - liabilities
prepare financial statements
10. Calculating Net Income
Revenues-Expenses
Net Income/Sales
companies must use GAAP for all significant transactions that will affect an investor's decisions - but insignificant transactions may be treated in alternative ways.
an appraised value for land gives additional information that is useful to investors
11. Common Stock
Credit Balance - Balance Sheet - Permanent - owners equity
Credit balance - income statement - temporary - revenues
prepare post-closing trial balance
Revenues-Expenses
12. 3rd step of Accounting Cycle
(long-term) assets (building - land - equipment)
Credit Balance - Balance Sheet - permanent - liability
prepar journal to general ledger
credit balance - balance sheet - permanent - liabilities
13. Inventory
prepare post-closing trial balance
debit balance - Balance sheet - permanent - asset
credit balance - balance sheet - permanent - liabilities
how we measure - assumes economic mean
14. Understandability
an appraised value for land gives additional information that is useful to investors
cost-salvage value/years of life
credit balance - income statement - temporary - Revenue
to those willing to take time to understand it
15. Economic Equity
prepare closing entry-post to general ledger
Net Income/Sales
each owner has its own books - records - financial statements that are seperate.
prepar journal to general ledger
16. Note Payable
Retained earnings beg. balance - Net income - dividends.
Sales Revenues
Credit Balance - Balance Sheet - permanent - liability
companies must reduce the value of land - if the value is lower than its original cost.
17. Closing Entries
determine the direction of the effect. debit or credit
Cost of Goods Sold - Utilities Expense - Supplies Expense - Wages Expense - Depreciation Expense - Interest Expense - Rent Expense
Close out all revenue and expense accounts into retained earnings.
assumes business will fully indefinitely ink the foreseeable futyre - justifies one of historical cost.
18. Relevance
prepare closing entry-post to general ledger
record transactions in general journal
an appraised value for land gives additional information that is useful to investors
debit balance - balance sheet - permanent - asset
19. 5th step of Accounting Cycle
credit balance - income statement - temporary - Revenue
analyze transactions from external events
record adjusting entries to general journal
does the equation remain in balance?
20. Intangibles
Retained earnings beg. balance - Net income - dividends.
Revenues-Expenses
prepare Unadjusted trial balance
copyright - long term assets - noncurrent
21. Accts on balance sheet
each owner has its own books - records - financial statements that are seperate.
decrease equity - debit balance
Assets - Liabilities - Equity
Debit Balance - Retained Earnings - Temporary - Owners Equity
22. Accounting Equation
assumes business will fully indefinitely ink the foreseeable futyre - justifies one of historical cost.
debit balance - balance sheet - permanent - asset
clarify accounts as Asset - Liabilities - Owners Equity - Expense - Revenue
Assets= Liabilities+Owners Equity<Contributed Capital><Retained Earnings-Revenues - Expenses>
23. NonCurrent Liabilities
prepar journal to general ledger
post journal to general ledger
longterm liabilities
Close out all revenue and expense accounts into retained earnings.
24. Balance sheet Equity
Contributed Capital - Retained Earnings - Dividends
how we measure - assumes economic mean
prepar journal to general ledger
a company uses the same method each year for calculating inventory
25. Prepaid insurance
record assets of cost paid to acquire them - continue to value assets at historical cost until sold - more objective than market cost.
post journal to general ledger
debit balance - balance sheet - permanent - asset
Sales-CGS=Gross Profit-selling expenses-admin expenses=Incom for operations+interest revenue-Interest expense=Income before tax-tax expense=Net income
26. Cash Principle
(cash - accts revievable - inventory) turn into cash within 12 months
record assets of cost paid to acquire them - continue to value assets at historical cost until sold - more objective than market cost.
Net Income/Sales
prepare adjusted trial balance
27. 1st Step of Analying Transactions
wages payable - utilities payable - interest payable - unearned revenue - note payable
Assets - Liabilities - Equity
Cash - Accounts recievable - supplies - inventory - prepaid rent - equipment - accumulated depreciation - goodwill - investments
Identify Accounts affected
28. Sales revenue
Credit Balance - Balance Sheet - Permanent - owners equity
prepare post-closing trial balance
cost-salvage value/years of life
credit balance - income statement - temporary - Revenue
29. Retained Earnings
clarify accounts as Asset - Liabilities - Owners Equity - Expense - Revenue
Assets - Liabilities - Equity
Credit balance - Balance sheet and Retained Earnings - Permanent
to those willing to take time to understand it
30. NonCurrent Assets
Cost of Goods Sold - Utilities Expense - Supplies Expense - Wages Expense - Depreciation Expense - Interest Expense - Rent Expense
(long-term) assets (building - land - equipment)
Sales Revenues
each owner has its own books - records - financial statements that are seperate.
31. Utilities expense
(cash - accts revievable - inventory) turn into cash within 12 months
debit balance - income statement - temporary - expense
debit balance - Balance sheet - Permanent - asset
credit balance - income statement - temporary - Revenue
32. 8th step of Accounting Cycle
longterm liabilities
(long-term) assets (building - land - equipment)
prepare financial statements
debit balance - Balance sheet - Permanent - asset
33. Accumulated depriciation
a company uses the same method each year for calculating inventory
Contra Asset - noncurrent asset
(cash - accts revievable - inventory) turn into cash within 12 months
credit balance - balance sheet - permanent - liabilities
34. Accumlated depreciation
debit balance - balance sheet - permanent - asset
debit balance - balance sheet - permanent - asset
Contra Asset - noncurrent asset
Assets= Liabilities+Owners Equity<Contributed Capital><Retained Earnings-Revenues - Expenses>
35. Income Statement Revenues
prepare Unadjusted trial balance
prepare adjusted trial balance
Sales Revenues
the original amount to purchase land is verifiable through the contract documents
36. Balance Sheet Liabilities
Debit Balance - Balance sheet - permanent - asset
a company uses the same method each year for calculating inventory
wages payable - utilities payable - interest payable - unearned revenue - note payable
record transactions in general journal
37. Goodwill
Credit Balance - Balance Sheet - Permanent - owners equity
(cash - accts revievable - inventory) turn into cash within 12 months
credit balance - balance sheet - permanent - liabilities
debit balance - balance sheet - permanent - asset
38. 2nd step of analyzing transactions
credit balance - balance sheet - permanent - liabilities
clarify accounts as Asset - Liabilities - Owners Equity - Expense - Revenue
Cost of Goods Sold - Utilities Expense - Supplies Expense - Wages Expense - Depreciation Expense - Interest Expense - Rent Expense
debit balance - income statement - temporary - expense
39. 3rd step of analyzing transactions
does the equation remain in balance?
companies must use GAAP for all significant transactions that will affect an investor's decisions - but insignificant transactions may be treated in alternative ways.
credit balance - balance sheet - permanent - liabilities
determine the direction of the effect. debit or credit
40. Accounts Recievable
assumes business will fully indefinitely ink the foreseeable futyre - justifies one of historical cost.
decrease equity - debit balance
Debit Balance - Balance sheet - permanent - asset
does the equation remain in balance?
41. Calculating Cost depreciation
Assets - Liabilities - Equity
cost-salvage value/years of life
prepare post-closing trial balance
prepare adjusted trial balance
42. Interest Expense
Sales-CGS=Gross Profit-selling expenses-admin expenses=Incom for operations+interest revenue-Interest expense=Income before tax-tax expense=Net income
Debit Balance - Retained Earnings - Temporary - Owners Equity
post journal to general ledger
Debit Balance - Income Statement - temporary - Expense
43. Dividends
Debit Balance - Retained Earnings - Temporary - Owners Equity
the original amount to purchase land is verifiable through the contract documents
decrease equity - debit balance
Current Assets/Current Liabilities
44. Materiality
debit balance - Balance sheet - permanent - asset
assumes business will fully indefinitely ink the foreseeable futyre - justifies one of historical cost.
companies must use GAAP for all significant transactions that will affect an investor's decisions - but insignificant transactions may be treated in alternative ways.
similar to unearned revenue- liabilities
45. Accts on Statement of Retained Earnings
debit balance - Balance sheet - Permanent - asset
to those willing to take time to understand it
Retained earnings beg. balance - Net income - dividends.
record assets of cost paid to acquire them - continue to value assets at historical cost until sold - more objective than market cost.
46. 10th step of Accounting Cycle
Contra Asset - noncurrent asset
clarify accounts as Asset - Liabilities - Owners Equity - Expense - Revenue
debit balance - income statement - temporary - expense
prepare post-closing trial balance
47. Income Satement Expenses
how we measure - assumes economic mean
debit balance - Balance sheet - Permanent - asset
to those willing to take time to understand it
Cost of Goods Sold - Utilities Expense - Supplies Expense - Wages Expense - Depreciation Expense - Interest Expense - Rent Expense
48. Interest Revenue
Credit balance - income statement - temporary - revenues
prepare financial statements
record assets of cost paid to acquire them - continue to value assets at historical cost until sold - more objective than market cost.
longterm liabilities
49. Balance Sheet Assets
companies must reduce the value of land - if the value is lower than its original cost.
Cash - Accounts recievable - supplies - inventory - prepaid rent - equipment - accumulated depreciation - goodwill - investments
Current Assets/Current Liabilities
record assets of cost paid to acquire them - continue to value assets at historical cost until sold - more objective than market cost.
50. Building
Assets= Liabilities+Owners Equity<Contributed Capital><Retained Earnings-Revenues - Expenses>
debit balance - Balance sheet - Permanent - asset
decrease equity - debit balance
companies must use GAAP for all significant transactions that will affect an investor's decisions - but insignificant transactions may be treated in alternative ways.
The First & Only Encyclopedia of Self Help,
Self Improvement & Career Advice
250+ Easy-to-Follow Guides
5000+ Proven Tips
13 Types of Essential Skills Covered
Get The Value of 100+ Best Books in 1 Book.
502 Pages | $3.99 | PDF / EPub, Kindle Ready
Top Scores
Anon hero
- 68%
Link to This Test
Related Subjects
Soft Skills
Business Skills
