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






2. A net loss occurs






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






4. Choosing the number of accounting periods






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






6. Contributed Capital + Retained Earnings

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






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






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






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






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






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






13. Their related asset accounts on the balance sheet






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

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






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






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






18. Working totals






19. As an expense and the corresponding liability accumulate.






20. Sole worker of your business






21. Revenues - Expenses






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






23. 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)






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






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






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






27. Separate legal entities - and the corporation can enter contracts and also be sued. Stockholder's cannot be sued.






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






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






30. Contains only balance sheet accounts.






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






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






33. People that estimate various things






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






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






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






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






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






39. Deferral of an expense! (Except land)






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






41. The amount allocated to any one accounting period.






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






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






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






45. Lists all accounts and their balances






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






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






48. 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






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






50. Decreases