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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 difficulty of deciding when a business transaction should be recorded






2. International Accounting Standards Board.






3. 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






4. A net loss occurs






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






6. Choosing the number of accounting periods






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






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






9. 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)






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






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






12. Postponement of recognition of an expense already paid.






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






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






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






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






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






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






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






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






21. Contains only balance sheet accounts.






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






23. Their related asset accounts on the balance sheet






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






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






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






27. Increases






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






29. People that estimate various things






30. Cash account






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

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32. The amount allocated to any one accounting period.






33. 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






34. Contributed Capital + Retained Earnings

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35. Lists all accounts and their balances






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






39. Decreases






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






41. Revenues - Expenses






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






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






44. Accounting Equation






45. 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.






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

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






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






49. Working totals






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