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






2. Accounting periods of less than a year.






3. Increases






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






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






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


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






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






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






10. Lists all accounts and their balances






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






12. A net loss occurs






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






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






15. 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.






16. 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






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






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






19. The amount allocated to any one accounting period.






20. Accounting Equation






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






22. Revenues - Expenses






23. Choosing the number of accounting periods






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






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






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






27. 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.






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






29. Their related asset accounts on the balance sheet






30. Sole worker of your business






31. People that estimate various things






32. Deferral of an expense! (Except land)






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






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






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






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






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


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






39. International Accounting Standards Board.






40. 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






41. Contains only balance sheet accounts.






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






43. Postponement of recognition of an expense already paid.






44. Decreases






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






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






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






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






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






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