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






2. The contra-asset account that accumulates all the depreciation of long-lived assets over the years






3. 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.






4. An account that gets subtracted from an asset account






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






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






7. Assets that help a business or person make money






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






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






10. Assets that can be used to pay current liabilities






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






12. Accounts that explain why assets went down from operations






13. A financial statement that calculates an end-of-period balance of the owner's equity account






14. A supply of items a business has on hand






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






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






17. Calc cash flow from opeations that does not start with NI - but does show cash-in cash-out cat. `






18. 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






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






20. Income-expenses






21. Money is 'expensed' if it is gone forever - if there remains no useful asset as a result of the spending. The opposite is CAPITALIZED






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






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






24. Accounts that explain why assets went up from operations






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






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






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






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






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






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






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






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






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






34. Income - Expenses = Net Income






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






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






37. Non-operating exp or revenues come from transactions that are not part of normal biz operations






38. Outsders to whom the business owes money






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






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






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






42. 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






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






44. Debts owned to people outside the company






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






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






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






48. 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.






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






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