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






3. Increases






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






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






6. International Accounting Standards Board.






7. The amount allocated to any one accounting period.






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






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






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






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






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






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






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






15. Revenues - Expenses






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






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






18. 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






19. Accounting Equation






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






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






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






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






25. As an expense and the corresponding liability accumulate.






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






27. Contains only balance sheet accounts.






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


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






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






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






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






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






34. Their related asset accounts on the balance sheet






35. Contributed Capital + Retained Earnings


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






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






38. Sole worker of your business






39. 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






40. Cash account






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






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






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






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






45. 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.






46. 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.






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






48. Decreases






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






50. Postponement of recognition of an expense already paid.