SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
CLEP Financial Accounting
Start Test
Study First
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. Used to accumulate the depreciation on each long-term asset
Net Income =
Accumulated Depreciation Accounts
Accrual Accounting
Accrued revenues
2. Focuses on assigning a monetary value to a business transaction and accounting for assets and liabilities.
Matching Rule
Not recorded as transactions
Continuity Assumption
Valuation Issue
3. The estimation of business's net income in terms of accounting periods.
Accumulated Depreciation accounts are deducted from..
Periodicity
Events that are recorded as transactions
Accumulated Depreciation Accounts
4. Revenues - Expenses
Long term assets are..
Continuity
Continuity Assumption
Net Income =
5. The net amount - or 'Book Value' of an asset
Carrying Value
Earnings Management
Accrued Expenses
Periodicity
6. Payments of rent - insurance - supplies - and the depreciation of plant and equipment
Accounting Equation
Allocating recorded costs between 2 or more accounting periods (ARC)
Post-closing trial balance
Going Concern
7. Net income on the income statement - and profitability comparisons from one accounting period to the next.
Adjusted Trial Balance
Revenues are what to SE..
Recognizing unrecorded - earned revenues
Adjusting entries affect...
8. 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
Final Trial Balance
Accrual Accounting
'Big Bath Theory'
Continuity
9. Forces a monetary value to a business transaction and accounting for the assets and liabilities that result from the transaction.
Recognizing Unrecorded Expenses (RUE)
Valuation
Expenses are what to SE..
Stockholder's Equity
10. Postponement of recognition of an expense already paid.
Accounting Equation
Deferral
Actuaries
Revenues are what to SE..
11. Balance sheet accounts - such as cash and accounts payable because they carry their end-of-period balances into the next accounting period
Periodicity
Contra Account
Permanent Accounts (Real Accounts)
SEC Requirements for transactions
12. A 12 month accounting period (Vary depending on slack seasons)
Interim Periods
Accrual Accounting
Cash Basis of Accounting
Fiscal Year
13. Deferral of an expense! (Except land)
Long term assets are..
Accounting Equation
GASB
Going Concern
14. Customer buys a service - company pays an employee for service - company performs service
Permanent Accounts (Real Accounts)
Net Income =
Events that are recorded as transactions
Continuity Assumption
15. Lists all accounts and their balances
Corporations
Accrual Accounting
Adjusted Trial Balance
Final Trial Balance
16. A body of people set up by Congress who protect the public by regulating the issuing - buying - and selling of stocks in the US.
Securities Exchange Commission (SEC)
Revenues are what to SE..
Sole proprietorship
IASB
17. Financial Accounting Standards Board - Designed by SEC to develop rules on accounting practice.
FASB
Valuation Issue
Accumulated Depreciation Accounts
Cost Principle
18. Contains only balance sheet accounts.
Adjusting entries NEVER affect..
Final Trial Balance
SEC Requirements for transactions
Securities Exchange Commission (SEC)
19. The manipulation of revenues and expenses to achieve a specific outcome.
Earnings Management
Consignment Sale
Steps for Income Summary Account
Carrying Value
20. Companies present annual financial statements on the assumption that the business will continue to operate indefinitely
Going Concern
Accumulated Depreciation Accounts
Securities Exchange Commission (SEC)
Cash Basis of Accounting
21. Shows the changes in RE over an accounting period.
Operating Activities
Income Summary Account
Statement of Retained Earnings:
GASB
22. As an expense and the corresponding liability accumulate.
Recognition
Accrued Expenses
Net Income =
Continuity Assumption
23. 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
Income Summary Account
Stockholder's Equity =
GAAP
Income Statement
24. Generally Accepted Accounting Principles - or guidelines for financial accounting.
Continuity
Actuaries
GAAP
Cash Basis of Accounting
25. Wages - Interest - and Income taxes that have been incurred but have not been recorded during an accounting period.
GASB
Accrual Accounting
Expenses are what to SE..
Recognizing Unrecorded Expenses (RUE)
26. Payments received in advance - and deposits made on goods and services
Allocating recorded - unearned revenues between 2 or more accounting periods (ARUR)
Steps for Income Summary Account
IASB
Events that are recorded as transactions
27. The practice of recording transactions at exchange price at the point of recognition.
Long term assets are..
Cost Principle
Going Concern
Valuation Issue
28. Unless there is evidence to the contrary - the accountant assumed that the business will continue to operate indefinitely
Carrying Value
Continuity Assumption
Income Statement
Dividends are what to SE
29. Government Accounting Standards Board - similar to FASB - issues accounting standards for state and local governments.
Recognizing unrecorded - earned revenues
Long term assets are..
GASB
Accumulated Depreciation accounts are deducted from..
30. Working totals
Continuity Assumption
Accrued Expenses
Earnings Management
Footings
31. The predetermined time at which a transaction should be recorded.
GAAP
Normal Balance
Recognition Point
Continuity Assumption
32. At a specific point in time (Certain Date)....Assets - Liabilities - Stockholder's equity.
Balance Sheet
Closing Entries
Valuation
Events that are recorded as transactions
33. Increases
Income Statement
Revenues are what to SE..
Going Concern
Stockholder's Equity =
34. When title to merchandise passes from the supplier to the purchaser and creates an obligation to pay.
We Recognize A Transaction
Recognition
Revenues are what to SE..
Final Trial Balance
35. Match expenses with the revenues that they help generate - & vice versa.
Adjusting entries NEVER affect..
Matching Rule
Adjusting entries affect...
Securities Exchange Commission (SEC)
36. It's usual balance and is the side (debit or credit) that increases the amount.
Accrued revenues
Normal Balance
Net Income =
Consignment Sale
37. Accounting periods of less than a year.
Allocating recorded - unearned revenues between 2 or more accounting periods (ARUR)
Liquidity
Allocating recorded costs between 2 or more accounting periods (ARC)
Interim Periods
38. Choosing the number of accounting periods
GASB
Income Summary Account
Accounting Equation
Continuity
39. Their related asset accounts on the balance sheet
Accumulated Depreciation accounts are deducted from..
Accumulated Depreciation Accounts
Cost Principle
Accrued revenues
40. Sole worker of your business
Normal Balance
Sole proprietorship
Continuity Assumption
Depreciation
41. The amount allocated to any one accounting period.
Fiscal Year
Actuaries
Depreciation
Stockholder's Equity
42. Separate legal entities - and the corporation can enter contracts and also be sued. Stockholder's cannot be sued.
Continuity Assumption
Going Concern
Corporations
Operating Activities
43. A temporary account that summarizes all revenues and expenses for the period.
Liquidity
Adjusted Trial Balance
Recognizing unrecorded - earned revenues
Income Summary Account
44. Decreases
Accrued revenues
Expenses are what to SE..
We Recognize A Transaction
Valuation Issue
45. Accounting Equation
GAAP
Adjusting entries affect...
Accumulated Depreciation accounts are deducted from..
Accounting Equation
46. Cash account
Adjusting entries NEVER affect..
Income Summary Account
Allocating recorded - unearned revenues between 2 or more accounting periods (ARUR)
We Recognize A Transaction
47. Society recognizes you as a partner of your partnership - so if you or they do something stupid - you are bound to that deal.
Recognizing unrecorded - earned revenues
Accumulated Depreciation Accounts
Mutual Agency
Matching Rule
48. The ability to have enough cash to pay debts when they are due.
Valuation Issue
Recognition Point
Dividends are what to SE
Liquidity
49. customer inquires about availability of service -company hires new employee -company signs contract to provide service in future
Going Concern
FASB
SEC Requirements for transactions
Not recorded as transactions
50. 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.
Accumulated Depreciation accounts are deducted from..
Long term assets are..
Recognizing unrecorded - earned revenues
Valuation Issue