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Test your basic knowledge |
DSST Principles Of Finance
Start Test
Study First
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. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Book Value
Expense Recognition Principle
Interim Financial Statements
Revenue Recognition Principle
2. Owners of a corporation who usually receive dividends. Also called shareholders.
Accrual Basis Accounting
Stockholders
Managerial Accounting
Full Disclosure Principle
3. An acronym for the National Association of Securities Dealers Automated Quotations. NASDAQ was founded in 1970 and is the largest electronic stock exchange in the United States. Unlike the NYSE - it has no physical location - existing entirely on cyb
Statement of Owner's Equity
Equity
Annual Financial Statements
NASDAQ
4. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Annual Financial Statements
International Financial Reporting Standards
Money Market Account
Book Value
5. Loaning or giving money to a business in orer to save it from bankruptcy.
Portfolio Income
Bailout
Federal Reserve System
Discretionary Income
6. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Classified Balance Sheet
Shareholders
External Transactions
Temporary Accounts
7. Gross increase in equity from a company's business activities that earn income.
General Journal
Debit
Work Sheet
Revenues
8. The value of a future cash steam discounted at the appropriate market interest rate.
Present Value
Accounting Period
External Users
Materiality Constraint
9. Owner's claim on the assets of a business; equals the residual interest in an entity's assets after deducting liabilities. Also called net assets.
Mergers
Equity
Internal users
SEC (Securites and Exchange Commision)
10. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Limited Liability Corporation
Cash Basis Accounting
Full Disclosure Principle
Bookkeeping
11. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.
Accrued Expenses
Unearned Revenue
T Account
Acquisition
12. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Time Period Assumptions
Balance Sheet
Working Papers
Permanent Accounts
13. Income from investments - including dividends - interest - or the sale of a property.
Portfolio Income
Assets
External Transactions
Revenues
14. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Adjusted Trial Balance
Natural Business Years
Source Documents
Statement of Owner's Equity
15. The twelve month period that ends when a company's sales activities are at their lowest point.
Source Documents
Monetary Unit Assumption
Natural Business Years
Unsecured Loan
16. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Statement of Cash Flows
Posting
Long Term Liabilities
Deficit
17. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Return
Partnership
Unearned Revenue
Post Closing Trial Balance
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).
Bookkeeping
Income Summary
Matching Principle (or Expense Recognition Principle)
T Account
19. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Corporation
Expense Recognition Principle
Partnership
Passive Income
20. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Temporary Accounts
Equity
Time Period Assumptions
External Users
21. An expense that changes from period to perio - such as food or gasoline costs.
Securities
Varaiable Expense
Bailout
Stockholders
22. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.
Trial balance
IRA (Individual Retirement Account)
Fixed Expense
Shares
23. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Revenue Recognition Principle
Interim Financial Statements
Current Ratio
Recordkeeping
24. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Owner Withdrawals
Materiality Constraint
CD (Certificate of Deposit)
Classified Balance Sheet
25. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Pro Forma Financial Statement
Ledger
Liabilities
CD (Certificate of Deposit)
26. 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.
SEC (Securites and Exchange Commision)
Expenses
Common Stock
Closing process
27. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
International Accounting Standards Board
Unclassified Balance Sheets
Bookkeeping
SEC (Securites and Exchange Commision)
28. Length of time covered by financial statements; also called reporting period.
Account Balance
Materiality Constraint
Accounting Period
Deficit
29. Expenses that remain the same regardless of the circumstances.
Ledger
NYSE (New York Stock Exchange)
Accounting Period
Fixed Expense
30. Business owned by a single person.
Operating Cycle
International Financial Reporting Standards
Temporary Accounts
Sole Propietorship
31. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Risk Tolerance
Working Papers
Internal users
Pro Forma Financial Statement
32. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.
Annual Financial Statements
Expense Recognition Principle
Intangible assets
Contra Account
33. The combining of two or more comapnies into one larger company.
Pro Forma Financial Statement
SEC (Securites and Exchange Commision)
Plant Assets
Mergers
34. The money left over when income exceeds expenditure.
Debit
Auditors
Surplus
Net Loss
35. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.
Accounting Period
T Account
External Transactions
Fiscal Year
36. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Profit Margin
Discretionary Income
Prepaid Expenses
Common Stock
37. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Balance Sheet
Unclassified Balance Sheets
Shares
Conceptual Framework
38. The NYSE was founded in 1792 and is the oldest and larvest securities market in the United States. it is located on Wall Street in New York.
Adjusted Trial Balance
Current Liabilities
Managerial Accounting
NYSE (New York Stock Exchange)
39. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
General Journal
External Transactions
Accrued Expenses
Business Entity Assumption
40. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Operating Cycle
Current Liabilities
Current Assets
Cash Basis Accounting
41. Activities within an organization that can affect the accounting equation.
Cash Basis Accounting
Account
Debtors
Internal transactions
42. Items paid for in advance of receiving their benefits. Classified as assets.
Prepaid Expenses
Money Market Account
Federal Reserve System
Profit Margin
43. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Shares
Net Loss
Securities
Long Term Liabilities
44. 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.
IRA (Individual Retirement Account)
Sarbanes-Oxley Act (SOX)
Federal Reserve System
Current Ratio
45. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Work Sheet
Shares
Net Loss
Return on Assets
46. 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
IRA (Individual Retirement Account)
Classified Balance Sheet
Working Papers
Sarbanes-Oxley Act (SOX)
47. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.
Intangible assets
Post Closing Trial Balance
Bonds
Compound Journal Entries
48. Individuals hired to review financial reports and information systems of organizations.
Measurement Principle
Ethical Dilemma
Closing process
Auditors
49. Entries recorded at the end of each accounting period to transfer end of period balances in revenue - gain - expense - loss - and withdrawal (dividend for a corporation) accounts to the capital account (to retain earnings for a corporation).
Risk
International Accounting Standards Board
Closing Entries
Working Papers
50. Uncertainty about expected return.
Cost-benefit Constraint
Sarbanes-Oxley Act (SOX)
Risk
Double Entry Accounting