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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. Revenues - Expenses






2. Working totals






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






4. People that estimate various things






5. The amount allocated to any one accounting period.






6. 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






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

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






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






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






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






12. As an expense and the corresponding liability accumulate.






13. Cash account






14. Their related asset accounts on the balance sheet






15. 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






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






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

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18. 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.






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






20. 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.






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






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






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






24. Accounting periods of less than a year.






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






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






27. Accounting Equation






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






29. Increases






30. Decreases






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






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






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






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






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






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






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






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






39. Contributed Capital + Retained Earnings

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






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






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






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






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






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






46. Sole worker of your business






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






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






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






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