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






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






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






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






5. 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






6. As an expense and the corresponding liability accumulate.






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


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






9. The amount allocated to any one accounting period.






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






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






12. 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






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






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






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






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






17. Sole worker of your business






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






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






20. Cash account






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






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






23. Postponement of recognition of an expense already paid.






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






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






26. Increases






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






28. Choosing the number of accounting periods






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






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






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






32. 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)






33. Revenues - Expenses






34. Their related asset accounts on the balance sheet






35. Accounting periods of less than a year.






36. International Accounting Standards Board.






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


38. Lists all accounts and their balances






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






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






41. Decreases






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






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






44. Contains only balance sheet accounts.






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






46. 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






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






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






49. 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.






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