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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. Decreases






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






3. 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)






4. 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






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






6. Contains only balance sheet accounts.






7. Deferral of an expense! (Except land)






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






9. Working totals






10. Revenues - Expenses






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






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






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






14. A net loss occurs






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






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






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

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






19. 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.






20. Sole worker of your business






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






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






23. As an expense and the corresponding liability accumulate.






24. 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






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






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






27. Increases






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






29. Cash account






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






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






32. Decreases






33. Postponement of recognition of an expense already paid.






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






35. Lists all accounts and their balances






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

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37. Accounting periods of less than a year.






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






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






40. People that estimate various things






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






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






43. International Accounting Standards Board.






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






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






46. 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






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






49. Choosing the number of accounting periods






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







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