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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. Choosing the number of accounting periods






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






3. Lists all accounts and their balances






4. Accounting periods of less than a year.






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






6. Decreases






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






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






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






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






11. Working totals






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






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






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


15. Increases






16. 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.






17. People that estimate various things






18. Contributed Capital + Retained Earnings


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






20. 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)






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






22. A net loss occurs






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






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






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






26. As an expense and the corresponding liability accumulate.






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






28. 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.






29. 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






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






31. Contains only balance sheet accounts.






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






33. Accounting Equation






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






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






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






37. Sole worker of your business






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






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






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






41. International Accounting Standards Board.






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






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






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






48. The amount allocated to any one accounting period.






49. Cash account






50. 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