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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. The first time a company sells shares of its stock to the public.






2. The principle prescribing that revenue is recognized when earned.






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






4. A legal entity that is seperate from its owners.






5. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.






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






7. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.






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






9. 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.






10. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.






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






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






13. 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.






14. 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






15. Record containing all accounts (with amounts) for a business.






16. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.






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






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






19. A security representing partial ownership of the company. It gives the holer priority to dividends over common stock investors. Capital stock that provides a specific dividend - which is paid before any dividends are pai to common stock holders - an






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






21. Statements that show the effect of proposed transactions and events as if they had occurred.






22. Process of recording transactions in a journal.






23. The value of a future cash steam discounted at the appropriate market interest rate.






24. 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.






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






26. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.






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






28. Uncertainty about expected return.






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






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






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






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






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






34. Normal time between paying cash for merchandise or employee services and receiving cash from customers.






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






36. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.






37. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.






38. Assets = Liabilities + Equity; Equity equals [Owner capital - owner withdrawal + revenue - expenses] for a non-corporation; Equity equals [Contributed capital - retained earnings + revenue - expenses] for a corporation where dividends are subtracted






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






40. A loan that is backed by collateral such as cars - houses - or other assets.






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






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






43. Debt securities that are issued by a borrower to raise capital . Bonds guarantee payments of the original amount borrowe plus interest and/or repayable on a fixed rate when the bond matures.






44. 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).






45. Individuals or organizations that owe money.






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






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






48. Monies (or sums of money) received from an investment; often in percent form.






49. Length of time covered by financial statements; also called reporting period.






50. 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.