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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 amount allocated to any one accounting period.






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






3. Contains only balance sheet accounts.






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






5. Accounting Equation






6. 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.






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

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






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






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






11. Choosing the number of accounting periods






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






13. Contributed Capital + Retained Earnings

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






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






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






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






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






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






20. International Accounting Standards Board.






21. Revenues - Expenses






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






23. A net loss occurs






24. 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)






25. 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






26. Postponement of recognition of an expense already paid.






27. Working totals






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






29. Their related asset accounts on the balance sheet






30. Sole worker of your business






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






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






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






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






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






36. Deferral of an expense! (Except land)






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






38. Lists all accounts and their balances






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






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






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






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






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






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






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






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






47. Cash account






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






49. Increases






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

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