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






2. International Accounting Standards Board.






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






4. 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






5. Their related asset accounts on the balance sheet






6. Cash account






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






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






9. Increases






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






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






12. Deferral of an expense! (Except land)






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






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






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






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






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






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






19. Accounting Equation






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






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






22. A net loss occurs






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






24. Lists all accounts and their balances






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






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






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






28. 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






29. Sole worker of your business






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






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

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






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






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






35. 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.






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






37. Contributed Capital + Retained Earnings

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38. Working totals






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






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






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






42. As an expense and the corresponding liability accumulate.






43. Decreases






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






45. Postponement of recognition of an expense already paid.






46. 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.






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






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






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






50. Revenues - Expenses