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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. A separate account that is paired with a related account






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






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






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

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






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






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






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






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






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






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






12. 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






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






14. The amount allocated to any one accounting period.






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






16. Contributed Capital + Retained Earnings

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






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






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






20. Revenues - Expenses






21. A net loss occurs






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






23. Choosing the number of accounting periods






24. Cash account






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






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






27. As an expense and the corresponding liability accumulate.






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






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






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






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






32. Deferral of an expense! (Except land)






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






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






35. Accounting Equation






36. Sole worker of your business






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






38. Contains only balance sheet accounts.






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






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






41. International Accounting Standards Board.






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






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






44. 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)






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






46. Their related asset accounts on the balance sheet






47. 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.






48. Postponement of recognition of an expense already paid.






49. 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






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