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






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






3. A net loss occurs






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






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






6. People that estimate various things






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






8. Working totals






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






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






11. Decreases






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






13. 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






14. Lists all accounts and their balances






15. Contains only balance sheet accounts.






16. Postponement of recognition of an expense already paid.






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






18. 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)






19. A separate account that is paired with a related account






20. Revenues - Expenses






21. Contributed Capital + Retained Earnings

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22. 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.






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






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






25. Increases






26. As an expense and the corresponding liability accumulate.






27. International Accounting Standards Board.






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






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






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






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






32. Choosing the number of accounting periods






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






35. The amount allocated to any one accounting period.






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

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37. Cash account






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






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






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






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






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






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






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






45. 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






46. Accounting periods of less than a year.






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

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






49. Deferral of an expense! (Except land)






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