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Test your basic knowledge |
CLEP Financial Accounting Vocab
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Study First
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 interest rate written on the face of a note
Face interest
Inventory
unrealized gain/loss
Discount a note
2. The dollar amount written on the face of the note
Expenses
Face amount
Draw (Withdrawl)
MACRS
3. The amount borrowed plus the interest up to a maturity date
fiscal year
future value of a note
Capitalized
Accumulated Depreciation
4. A note with an interest rate written on the face - whose face amount is the present value
Contra Account
Inventory
interest-bearing note
present value of a note
5. The inventory system that averages the cost of all items in inventory and assigns that averaged cost the the items sold.
Weighted average
Net
liabilities
Vertical Journal Entries
6. A depr method that results in higher depr exp in an assets early years
Accelerated depr method
Discount a note
Netted
owners equity
7. The official list of all business accounts
Chart of Accounts
Net income
Discount a note
Account
8. The cost of business airplane fairs - trains and long-distance buses
creditors
Transportation expense
Face interest
Periodic inventory method
9. The amount borrowed - or the principal. Interest-bearing notes show the present value as the face amount
Expensed
Chart of Accounts
present value of a note
Contra-asset account
10. Contra-asset account that accumulates all the deprec of long lived assets over the years
operating cycle
Perpetual inventory method
T-account
Accumulated Depreciation
11. An income account that explains the increase in business assets as a result of selling goods
fiscal year
Inventory
Net Income
Sales
12. A supply of items a business has on hand
Depreciation Expense
Accumulated Depreciation
Inventory
Netted
13. 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
Cash Flow Statement
Accumulated Depreciation
Account
Vertical Journal Entries
14. The contra-asset account that accumulates all the depreciation of long-lived assets over the years
Draw (Withdrawl)
Accumulated Depreciation
Contra Account
Cost of goods sold
15. Method of journalizing and posting accounts at the same time by recording transac vertically in columns
Vertical Journal Entries
creditors
Balance sheet
Face amount
16. The financial report that shows business assets - liabilities - and the owners equity on a particular day
Balance sheet
Cost of goods sold
present value of a note
Capital
17. Economic resources that the business plans to use in the future to make money
Assets
Capital
Perpetual inventory method
unrealized gain/loss
18. Recorded the cost as an asset
Non-operating
Capitalized
Balance sheet
Inventory
19. Outsders to whom the business owes money
Sales
creditors
Contra-asset account
Travel Expense
20. An account that gets subtracted from an asset account
Sales
Face amount
Contra-asset account
Capital
21. Debts owned to people outside the company
Expensed
Transportation expense
liabilities
Income
22. Money that the owner takes from the business or money in the business account that the owner spends on personal bills.
Contra Account
Direct method
Draw (Withdrawl)
Discount a note
23. 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.
Chart of Accounts
Percentage Analysis
Depreciable cost
Expenses
24. The cost of living while away from home of business
Percentage Analysis
Discount a note
Travel Expense
Periodic inventory method
25. Income - Expenses = Net Income
Capitalized
Perpetual inventory method
Income
Net Income
26. A place on the financial books to keep track of financial info that the owners want to know
Capital
Accumulated Depreciation
present value of a note
Account
27. The cost to the business of the goods that it sells
Cost of goods sold
Depreciation Expense
Accumulated Depreciation
Face amount
28. To sell a note to a bank that subtracts a discount - giving the seller the proceeds`
Discount a note
owners equity
Indirect method
Direct method
29. A word that means a subtraction has occured
Cost of goods sold
Cost of goods sold
Net
operating cycle
30. 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.
Periodic inventory method
fiscal year
owners equity
Expensed
31. The cost the the biz of the goods it sells
Capital
Cost of goods sold
Net Income
Income Statement
32. Usual method - starts with NI and uses the changes in the A&L accounts to adjust NI into cash flow from operations
unrealized gain/loss
Indirect method
future value of a note
Contra Account
33. Assets that help a business or person make money
Capital
Travel Expense
liabilities
Income statement
34. When numbers are 'netted' they combine so that the negative numbers get subtracted from the positive numbers
Accelerated depr method
owners equity
Netted
interest-bearing note
35. Accounts that explain why assets went down from operations
Vertical Journal Entries
Expenses
Face interest
Accumulated Depreciation
36. The financial report that shows the result of business operations over a period of time
Vertical Journal Entries
Income Statement
Face amount
fiscal year
37. When money is changed into another asset that helps the business make money
Expensed
Accumulated Depreciation
Capitalized
Perpetual inventory method
38. The natural period of time before a certain business activities tend to repeat -usually one year
operating cycle
Accumulated Depreciation
Transportation expense
Indirect method
39. Asset has not been sold but a gain or loss has occurred
unrealized gain/loss
Income statement
Capitalized
Account
40. The amount of the historical cost of an asset that gets allocated over the useful life of the asset
Netted
Depreciation Expense
Depreciable cost
Contra Account
41. Calc cash flow from opeations that does not start with NI - but does show cash-in cash-out cat. `
Direct method
fiscal year
creditors
Balance sheet
42. Money is 'expensed' if it is gone forever - if there remains no useful asset as a result of the spending. The opposite is CAPITALIZED
Expensed
future value of a note
Discount a note
Income
43. The inventory method that increases the inventory account with every purchase and lowers the inventory with every sale.
current liabilities
Income statement
Perpetual inventory method
Direct method
44. The 12 month period a business used to report the results of its operatons
Inventory
Income Statement
Income
fiscal year
45. An account that gets subtracted from its related account. Contra accounts always get reported as negative numbers.
Contra Account
Sales
Accumulated Depreciation
Weighted average
46. 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
Accumulated Depreciation
Income
T-account
Net
47. That porition of the business the owner gets to keep after paying all creditors
Non-operating
owners equity
Accelerated depr method
Cost of goods sold
48. Assets that can be used to pay current liabilities
current liabilities
current assets
MACRS
Face amount
49. Modified accelerated cost recovery syste - for which IRS tables tell the rate by which to multiply an assets historical cost
Draw (Withdrawl)
creditors
MACRS
Depreciation Expense
50. Accounts that explain why assets went up from operations
Assets
Income
Travel Expense
Direct method