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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. The value of a future cash steam discounted at the appropriate market interest rate.
Working Papers
Assets
Present Value
Business Entity Assumption
2. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Sole Proprietorship
Balance Column Account
Business Entity Assumption
Financial Accounting Standards Board
3. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Net Loss
Going-concern Assumptions
Working Papers
Current Liabilities
4. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Unclassified Balance Sheets
Fixed Expense
Plant Assets
Interim Financial Statements
5. Income from investments - including dividends - interest - or the sale of a property.
Revenues
Portfolio Income
Posting
Unearned Revenue
6. Happenings that both affect an organization's financial position and can be reliably measured.
Events
Liabilities
Bookkeeping
Compound Journal Entries
7. Excess of expenses over revenues for a period.
Net Loss
Limited Liability Corporation
Reversing Entries
Accrued Expenses
8. Principle that assumes transactions and events can be expressed in money units.
Monetary Unit Assumption
Classified Balance Sheet
Acquisition
Cash Basis Accounting
9. Length of time covered by financial statements; also called reporting period.
IPO
Business Entity Assumption
Accounting Period
Securities
10. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Closing Entries
CD (Certificate of Deposit)
Securities and Exchange Commission
Plant Assets
11. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
Recordkeeping
Owner - Capital
Accrued Expenses
Events
12. Journal entries that affect at least three accounts.
Temporary Accounts
Return
Partnership
Compound Journal Entries
13. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
Ethics
Monetary Unit Assumption
Partnership Agreement
Annual Financial Statements
14. Assets put into the business by the owner.
Owner Investment
Limited Liability Corporation
Chart of Accounts
Pro Forma Financial Statement
15. Record containing all accounts (with amounts) for a business.
Ledger
Operating Cycle
Double Entry Accounting
Liabilities
16. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Federal Reserve System
Materiality Constraint
Risk Tolerance
Audit
17. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
External Users
Stock
Working Papers
Prepaid Expenses
18. Process of recording transactions in a journal.
Journalizing
Materiality Constraint
Common Stock
Deficit
19. An investment scam that uses the assets from new investors to make payments to older investors. Named after Charles Ponzi who used the technique in the early 1900s to defraud thousands of investors.
Ethical Dilemma
Ponzi Scheme
Net Loss
Return on Assets
20. Assets pulled out of the business by the owner.
Owner Withdrawals
Risk
T Account
IPO
21. Tool used to show the effects of transactions and events on individual accounts.
Risk
T Account
IPO
Common Stock
22. A loan that is backed by collateral such as cars - houses - or other assets.
Post Closing Trial Balance
Secured Loan
Stock
Income Statement
23. The money left over when income exceeds expenditure.
Creditors
Posting
Bookkeeping
Surplus
24. Uncertainty about expected return.
Risk
Revenues
Monetary Unit Assumption
Unsecured Loan
25. A corporation's basic ownership share.
Owner - Capital
Common Stock
Financial Accounting Standards Board
Credit
26. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Owner Withdrawals
Pro Forma Financial Statement
Unadjusted Trial Balance
Debit
27. Individuals or organizations that owe money.
Net Loss
Debtors
Adjusting Entry
Balance Column Account
28. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Partnership
Debt Ratio
Posting
Closing process
29. 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).
Income Summary
Events
Compound Journal Entries
Return on Assets
30. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.
NASDAQ
Closing process
Bookkeeping
Risk Tolerance
31. 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.
Post Closing Trial Balance
Federal Reserve System
Measurement Principle
Depreciation
32. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Fiscal Year
Net Loss
Stockholders
Net Income
33. Individuals hired to review financial reports and information systems of organizations.
IPO
Securities
Auditors
Mergers
34. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.
Partnership Agreement
Managerial Accounting
Partnership
Classified Balance Sheet
35. Accounting standards set by the IASB which aim to develop a single set of global standards - to promote those standards - and converge national and international standards globally.
Passive Income
Accrued Expenses
International Financial Reporting Standards
Cost-benefit Constraint
36. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Permanent Accounts
Statement of Cash Flows
Full Disclosure Principle
Expanded Accounting Equation
37. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Revenue Recognition Principle
Net Loss
Managerial Accounting
Debit
38. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Income Statement
Double Entry Accounting
Risk Tolerance
Materiality Constraint
39. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Stock
Ethical Dilemma
Unadjusted Trial Balance
Partnership Agreement
40. 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
Owner Withdrawals
Intangible assets
Ethics
Sarbanes-Oxley Act (SOX)
41. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Auditors
Work Sheet
Straight-line Depreciation Method
Operating Cycle
42. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Portfolio Income
Classified Balance Sheet
Accounting Equation
Matching Principle (or Expense Recognition Principle)
43. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Annual Financial Statements
Fixed Expense
Current Ratio
Account
44. 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.
Expense Recognition Principle
Compound Journal Entries
Unearned Revenue
Common Stock
45. All purpose journal for recording the debits and credits of transactions and events.
Passive Income
General Journal
Expenses
Monetary Unit Assumption
46. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Ethical Dilemma
Trial balance
Secured Loan
Revenue Recognition Principle
47. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.
Portfolio Income
Materiality Constraint
Adjusted Trial Balance
Acquisition
48. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Posting Reference Column
Unsecured Loan
Return on Assets
International Accounting Standards Board
49. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.
Debt Ratio
Accrued Revenues
Stock
Account Balance
50. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Current Liabilities
Permanent Accounts
Intangible assets
Unclassified Balance Sheets