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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. Accounting Equation






2. Choosing the number of accounting periods






3. 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






4. Postponement of recognition of an expense already paid.






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






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






7. Their related asset accounts on the balance sheet






8. Decreases






9. Contributed Capital + Retained Earnings

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






11. As an expense and the corresponding liability accumulate.






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






13. 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






14. Decreases






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






16. Deferral of an expense! (Except land)






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






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






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






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






21. People that estimate various things






22. A net loss occurs






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






24. Contains only balance sheet accounts.






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






26. 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






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






28. Sole worker of your business






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






30. International Accounting Standards Board.






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






32. The amount allocated to any one accounting period.






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






34. 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)






35. 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.






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

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






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






39. Revenues - Expenses






40. Increases






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






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






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






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






45. Working totals






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






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






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






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






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







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