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






2. As an expense and the corresponding liability accumulate.






3. Increases






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






5. Decreases






6. Postponement of recognition of an expense already paid.






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






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






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






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






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

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12. Deferral of an expense! (Except land)






13. Decreases






14. 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.






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






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






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






18. 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






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






20. Contributed Capital + Retained Earnings

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






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






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






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






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






26. 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.






27. Cash account






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






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






30. Contains only balance sheet accounts.






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






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






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






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






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






36. Lists all accounts and their balances






37. Sole worker of your business






38. Their related asset accounts on the balance sheet






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






40. People that estimate various things






41. 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






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






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






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






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






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






47. 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






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






49. A net loss occurs






50. Choosing the number of accounting periods