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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. People that estimate various things






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






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






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






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






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






7. Accounting periods of less than a year.






8. 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






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






10. Accounting Equation






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






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






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

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14. Choosing the number of accounting periods






15. Sole worker of your business






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






17. Their related asset accounts on the balance sheet






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






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






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






21. 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






22. 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






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






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






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






26. Postponement of recognition of an expense already paid.






27. Decreases






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






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






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






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






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






33. Contains only balance sheet accounts.






34. Contributed Capital + Retained Earnings

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35. 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.






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






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






38. 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.






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






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






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






42. A net loss occurs






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






44. Decreases






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






46. As an expense and the corresponding liability accumulate.






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

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48. Working totals






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






50. Cash account