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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. Accounting Equation






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






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






4. The amount allocated to any one accounting period.






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






6. Deferral of an expense! (Except land)






7. 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






8. A net loss occurs






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






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






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






12. International Accounting Standards Board.






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






14. 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)






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






16. Increases






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






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

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19. Decreases






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






21. Postponement of recognition of an expense already paid.






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






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






24. 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.






25. Choosing the number of accounting periods






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






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






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






29. Sole worker of your business






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






31. Working totals






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






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. Accounting periods of less than a year.






35. 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






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






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






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






39. Cash account






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






41. Decreases






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

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






44. Lists all accounts and their balances






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






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






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






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






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






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