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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. Determines corporate policy - declares dividends and appoints management.






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






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






4. Sole worker of your business






5. 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.






6. Cash account






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






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






9. The amount allocated to any one accounting period.






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






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






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






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

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






15. Their related asset accounts on the balance sheet






16. Deferral of an expense! (Except land)






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






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






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






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






21. Accounting Equation






22. Common Stock + Retained Earnings - Dividends + Revenues - Expenses

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






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






25. International Accounting Standards Board.






26. Contributed Capital + Retained Earnings

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






28. A net loss occurs






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






30. 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






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






32. The difficulty of deciding when a business transaction should be recorded






33. People that estimate various things






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






35. Accounting periods of less than a year.






36. When an entity sends out a product to a distributor and takes a certain percentage for what they sell it for (Usually occurs when they have excess inventory)






37. Revenues - Expenses






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






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






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






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






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






43. 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.






44. Increases






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






46. As an expense and the corresponding liability accumulate.






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






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






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






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