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CLEP Financial Accounting Vocab

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 inventory method that keeps track of merchandise costs in various purchases and contra-purchases accounts and then computes cost of goods sold on the income statement. Inventory on the books is adjusted only at year-end.






2. A tool to keep track of the ops and downs in account. The ups go on one side of the T and the downs go on the other






3. Modified accelerated cost recovery syste - for which IRS tables tell the rate by which to multiply an assets historical cost






4. The inventory system that averages the cost of all items in inventory and assigns that averaged cost the the items sold.






5. The 12 month period a business used to report the results of its operatons






6. A word that means a subtraction has occured






7. That porition of the business the owner gets to keep after paying all creditors






8. Accounts that explain why assets went up from operations






9. The financial report that shows the result of business operations over a period of time






10. The amount borrowed plus the interest up to a maturity date






11. An account that gets subtracted from an asset account






12. Where cash came from and where it went - Cash flow from operations - cash flow from investing activities - cash flow from financing activities - calculation of (1) net cash flow - and (2) cash - end of period






13. An income account that explains the increase in business assets as a result of selling goods






14. Debts that must be paid within one year or one operating cycle - whichever is longer






15. A note with an interest rate written on the face - whose face amount is the present value






16. Income-expenses






17. The cost of living while away from home of business






18. When money is changed into another asset that helps the business make money






19. Money that the owner takes from the business or money in the business account that the owner spends on personal bills.






20. A depr method that results in higher depr exp in an assets early years






21. The amount of long-lived assets used up during operations






22. A supply of items a business has on hand






23. Assets that can be used to pay current liabilities






24. A financial statement analysis technique in which one number is assigned 100% and all other numbers are expressed as a percentage of the first number. In balance sheets. the key number is total assets. In income statements - the key # is sales.






25. The financial report that shows the result of biz operations over a period of time






26. The financial report that shows business assets - liabilities - and the owners equity on a particular day






27. The dollar amount written on the face of the note






28. Asset has not been sold but a gain or loss has occurred






29. Money is 'expensed' if it is gone forever - if there remains no useful assert as a result of the spending. THe opposite of capitalized. `






30. The cost of business airplane fairs - trains and long-distance buses






31. The interest rate written on the face of a note






32. Assets that help a business or person make money






33. Accounts that explain why assets went down from operations






34. Usual method - starts with NI and uses the changes in the A&L accounts to adjust NI into cash flow from operations






35. To sell a note to a bank that subtracts a discount - giving the seller the proceeds`






36. Income - Expenses = Net Income






37. The cost the the biz of the goods it sells






38. An account that gets subtracted from its related account. Contra accounts always get reported as negative numbers.






39. Method of journalizing and posting accounts at the same time by recording transac vertically in columns






40. The official list of all business accounts






41. A place on the financial books to keep track of financial info that the owners want to know






42. The amount borrowed - or the principal. Interest-bearing notes show the present value as the face amount






43. The cost to the business of the goods that it sells






44. The amount of the historical cost of an asset that gets allocated over the useful life of the asset






45. Contra-asset account that accumulates all the deprec of long lived assets over the years






46. The inventory method that increases the inventory account with every purchase and lowers the inventory with every sale.






47. Outsders to whom the business owes money






48. Economic resources that the business plans to use in the future to make money






49. Debts owned to people outside the company






50. When numbers are 'netted' they combine so that the negative numbers get subtracted from the positive numbers