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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. Debts owned to people outside the company






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






3. Recorded the cost as an asset






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






5. A word that means a subtraction has occured






6. 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.






7. Accounts that explain why assets went up from operations






8. A supply of items a business has on hand






9. Assets that can be used to pay current liabilities






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






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






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






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






14. Income - Expenses = Net Income






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






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






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






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






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






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






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






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






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






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






26. An account that gets subtracted from an asset account






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






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






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






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






31. The official list of all business accounts






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






33. 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






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






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






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






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






38. The natural period of time before a certain business activities tend to repeat -usually one year






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






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






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






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






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






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






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






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






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






48. Accounts that explain why assets went down from operations






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






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







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