Test your basic knowledge |

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. 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)






2. Deferral of an expense! (Except land)






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






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






5. Decreases






6. customer inquires about availability of service -company hires new employee -company signs contract to provide service in future






7. Accounting Equation






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






9. People that estimate various things






10. Lists all accounts and their balances






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






12. Contributed Capital + Retained Earnings


13. A net loss occurs






14. Determines corporate policy - declares dividends and appoints management.






15. As an expense and the corresponding liability accumulate.






16. 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






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






18. Decreases






19. Their related asset accounts on the balance sheet






20. 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.






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






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






23. Working totals






24. Contains only balance sheet accounts.






25. Increases






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






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






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






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






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






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






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


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


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






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






36. Revenues - Expenses






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






38. International Accounting Standards Board.






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






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






41. Postponement of recognition of an expense already paid.






42. Sole worker of your business






43. 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.






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






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






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






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






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






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






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