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CLEP Financial Accounting

Subjects : clep, 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. Contains only balance sheet accounts.






2. The net amount - or 'Book Value' of an asset






3. The predetermined time at which a transaction should be recorded.






4. Generally Accepted Accounting Principles - or guidelines for financial accounting.






5. Decreases






6. Working totals






7. Unless there is evidence to the contrary - the accountant assumed that the business will continue to operate indefinitely






8. People that estimate various things






9. Close the revenues account - Close the expense account - Close the income summary account - Close the dividends account






10. A net loss occurs






11. Lists all accounts and their balances






12. Wages - Interest - and Income taxes that have been incurred but have not been recorded during an accounting period.






13. A temporary account that summarizes all revenues and expenses for the period.






14. Determines that all temporary accounts have zero balances and to double check that total debits = total credits






15. Government Accounting Standards Board - similar to FASB - issues accounting standards for state and local governments.






16. Payments received in advance - and deposits made on goods and services






17. Deals with all techniques accountants use to apply the matching rule: Recording revenue when they are earned - Recording expenses when they are incurred - More closely related to profitability - Adjusting the accounts






18. Companies present annual financial statements on the assumption that the business will continue to operate indefinitely






19. Revenues that a company has earned but for which no entry has been made in the accounting records






20. If you're having a bad year - to dump everything into something else like pensions

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21. At a specific point in time (Certain Date)....Assets - Liabilities - Stockholder's equity.






22. Separate legal entities - and the corporation can enter contracts and also be sued. Stockholder's cannot be sued.






23. Revenues - Expenses






24. Society recognizes you as a partner of your partnership - so if you or they do something stupid - you are bound to that deal.






25. Financial Accounting Standards Board - Designed by SEC to develop rules on accounting practice.






26. Used to accumulate the depreciation on each long-term asset






27. Net income on the income statement - and profitability comparisons from one accounting period to the next.






28. The practice of recording transactions at exchange price at the point of recognition.






29. Sole worker of your business






30. The ability to have enough cash to pay debts when they are due.






31. Revenue that a company has earned for providing a service but for which it has not billed or been paid by the end of the accounting period.






32. A separate account that is paired with a related account






33. When title to merchandise passes from the supplier to the purchaser and creates an obligation to pay.






34. Selling goods and services to customers - employing managers and workers.






35. Decreases






36. A body of people set up by Congress who protect the public by regulating the issuing - buying - and selling of stocks in the US.






37. Increases






38. Forces a monetary value to a business transaction and accounting for the assets and liabilities that result from the transaction.






39. Accounting Equation






40. Focuses on assigning a monetary value to a business transaction and accounting for assets and liabilities.






41. It's usual balance and is the side (debit or credit) that increases the amount.






42. The manipulation of revenues and expenses to achieve a specific outcome.






43. International Accounting Standards Board.






44. A 12 month accounting period (Vary depending on slack seasons)






45. Shows the changes in RE over an accounting period.






46. Balance sheet accounts - such as cash and accounts payable because they carry their end-of-period balances into the next accounting period






47. Accounting for revenues in the period in which cash is received and for expenses in the period where cash is paid. More closely related to the goal of liquidity.






48. Choosing the number of accounting periods






49. Their related asset accounts on the balance sheet






50. Summarizes revenues earned and expenses incurred by a business over an accounting period. (Shows whether a business achieved its profitability goal)...Revenues - Expenses - Income taxes