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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. Increases






2. A net loss occurs






3. 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






4. 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






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






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






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






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






9. Accounting Equation






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






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






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






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






14. Sole worker of your business






15. Cash account






16. Working totals






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






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






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






20. 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)






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






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






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






24. Revenues - Expenses






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






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






27. People that estimate various things






28. International Accounting Standards Board.






29. 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.






30. Contributed Capital + Retained Earnings


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






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






33. Accounting periods of less than a year.






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






35. As an expense and the corresponding liability accumulate.






36. Contains only balance sheet accounts.






37. Choosing the number of accounting periods






38. Deferral of an expense! (Except land)






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






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






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






42. Lists all accounts and their balances






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


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






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






46. The amount allocated to any one accounting period.






47. 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.






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






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






50. 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