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