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






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






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






4. The amount allocated to any one accounting period.






5. 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






6. Accounting Equation






7. Payments of rent - insurance - supplies - and the depreciation of plant and equipment






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






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






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

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






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






13. 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.






14. Cash account






15. Their related asset accounts on the balance sheet






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






17. Postponement of recognition of an expense already paid.






18. International Accounting Standards Board.






19. Match expenses with the revenues that they help generate - & vice versa.






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






21. 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






22. Lists all accounts and their balances






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






24. Persuasive evidence of arrangement - Seller's price is fixed or determinable - Product or service has been delivered - Collectibility is reasonably assured






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






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






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






28. Increases






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






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






31. Choosing the number of accounting periods






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






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






34. Customer buys a service - company pays an employee for service - company performs service






35. Made at the end of accounting period..-They clear revenue - expense accounts - and dividends account of their balances. -Summarize a period's revenue and expenses by transferring the balances of them to the income summary account






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






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






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






39. People that estimate various things






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






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






42. Accounting periods of less than a year.






43. Contributed Capital + Retained Earnings

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44. Sole worker of your business






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






46. A net loss occurs






47. The estimation of business's net income in terms of accounting periods.






48. Revenues - Expenses






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






50. Working totals