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. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.






2. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.






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






4. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.






5. 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.






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






7. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.






8. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).






9. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.






10. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Matching Principle.






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






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






13. Accounting information is based on cost with potential subsequent adjustments to fair value.






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






15. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.






16. Activities within an organization that can affect the accounting equation.






17. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.






18. Journal entries that affect at least three accounts.






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






20. Independent group of full-time members responsible for setting accounting rules.






21. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.






22. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.






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






24. The combining of two or more comapnies into one larger company.






25. Individuals or organizations that owe money.






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






27. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.






28. All purpose journal for recording the debits and credits of transactions and events.






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






30. Principle that assumes transactions and events can be expressed in money units.






31. 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






32. Assets put into the business by the owner.






33. 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.






34. Business owned by two or more people.






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






36. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity






37. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.






38. Income from investments - including dividends - interest - or the sale of a property.






39. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.






40. List of accounts and balances prepared before accounting adjustments are recorded and posted.






41. 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).






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






43. 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






44. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.






45. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.






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






47. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.






48. 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.






49. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.






50. 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.