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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. Accounting Equation






3. Sole worker of your business






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






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






6. Increases






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






8. Decreases






9. 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.






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






11. 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






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






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






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






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






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






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






18. Working totals






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






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






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






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






23. Postponement of recognition of an expense already paid.






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






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

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






27. Decreases






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






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






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






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






32. As an expense and the corresponding liability accumulate.






33. Contains only balance sheet accounts.






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






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






36. International Accounting Standards Board.






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






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






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






40. Cash account






41. Choosing the number of accounting periods






42. Contributed Capital + Retained Earnings

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






44. Their related asset accounts on the balance sheet






45. Deferral of an expense! (Except land)






46. The amount allocated to any one accounting period.






47. Lists all accounts and their balances






48. 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)






49. 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






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