Test your basic knowledge |

DSST Principles Of Finance

Subjects : dsst, 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. Revenues earned in a period that both unrecorded and not yet received in cash (or other assets; adjusting entries for recording accrued revenues involve increasing assets and increasing revenues.






2. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)






3. Individuals or organizations entitled to receive payments






4. Difference between total debits and total credits (including the beginning balance) for an account.






5. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.






6. Business owned by a single person.






7. Business owned by one person that is not organized as a corporation.






8. Business owned by two or more people.






9. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.






10. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.






11. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.






12. Items paid for in advance of receiving their benefits. Classified as assets.






13. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.






14. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.






15. Persons using accounting information who are not directly involved in running the organization.






16. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.






17. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.






18. Temporary account used only in the closing process to which the balances of revenue and expense accounts (including any gains or losses) are transferred. Its balance is transferred to the capital account (or retained earnings for a corporation).






19. Income that is available after all of the essential financial commitments have been paid.






20. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.






21. Creditors' claims on an organization's assets; involves a probable future payment of assets - products - or services that a company is obligated to make due to past transactions or events.






22. Financial statement that subtracts expenses from revenues to yield a net income or loss over a specified period of time; also includes any gains or losses.






23. Journal entries that affect at least three accounts.






24. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.






25. The central bank of the United States - with 12 Federal Reserve branch banks located in major cities throughout the nation. It helps to regulate the US monetary and banking system.






26. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.






27. Assets put into the business by the owner.






28. Outflows or using up of assets as part of operations of business to generate sales.






29. Balance sheet that broadly groups assets - liabilities - and equity accounts.






30. Persons using accounting information who are directly involved in managing the organization.






31. Area of accounting aimed mainly at serving the decision-making needs of internal users.






32. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.






33. A tax deferred account that allows individuals to plan for their retirement.






34. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.






35. Resources that a company owns or controls that are expected to provide current and future benefits to the business.






36. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.






37. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.






38. The twelve month period that ends when a company's sales activities are at their lowest point.






39. Happenings that both affect an organization's financial position and can be reliably measured.






40. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.






41. A security representing a share of ownership in a company - providing voting rights - and entitling the holer to a share of the company's success through dividends and/or capital appreciation.






42. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.






43. List of accounts and balances prepared after period-end adjustments are recorded and posted.






44. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.






45. Owners of a corporation who usually receive dividends. Also called shareholders.






46. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.






47. Create the Public Company Accounting Oversight Board - regulates analyst conflicts - imposes corporate governance requirements - enhances accounting and control disclosures - impacts insider transactions and executive loans - establishes new types of






48. Exchanges of economic value between one entity and another entity.






49. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.






50. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.