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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. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Income Statement
Unclassified Balance Sheets
Fixed Expense
IPO
2. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.
Fiscal Year
Partnership Agreement
Ledger
Varaiable Expense
3. 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
Ledger
Passive Income
Account
Sarbanes-Oxley Act (SOX)
4. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Unsecured Loan
Operating Cycle
Internal transactions
Sarbanes-Oxley Act (SOX)
5. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenue
Limited Liability Corporation
Bonds
Fixed Expense
6. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Adjusted Trial Balance
IPO
Compound Journal Entries
Annual Financial Statements
7. Exchanges of economic value between one entity and another entity.
Owner - Capital
External Transactions
Income Summary
Posting Reference Column
8. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
International Accounting Standards Board
Book Value
Federal Reserve System
Temporary Accounts
9. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Net Income
Common Stock
Expense Recognition Principle
Partnership
10. Report of changes in equity over a period; adjusted for increases and for decreases.
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11. Individuals or organizations that owe money.
Partnership
Conceptual Framework
Debtors
Sole Proprietorship
12. Principle that assumes transactions and events can be expressed in money units.
Stock
Monetary Unit Assumption
Unearned Revenue
T Account
13. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.
Trial balance
Net Income
Owner - Capital
Partnership
14. 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
Secured Loan
Equity
Unsecured Loan
15. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Time Period Assumptions
Corporations
Risk Tolerance
Partnership Agreement
16. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Interim Financial Statements
CD (Certificate of Deposit)
Common Stock
Straight-line Depreciation Method
17. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
International Financial Reporting Standards
Permanent Accounts
NASDAQ
Securities
18. Tool used to show the effects of transactions and events on individual accounts.
SEC (Securites and Exchange Commision)
T Account
Depreciation
Statement of Cash Flows
19. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Posting
Partnership
Annual Financial Statements
Internal users
20. Assets pulled out of the business by the owner.
Owner Withdrawals
Pro Forma Financial Statement
Recordkeeping
Sarbanes-Oxley Act (SOX)
21. Owners of a corporation who usually receive dividends. Also called shareholders.
Financial Accounting Standards Board
Return on Assets
Accrual Basis Accounting
Stockholders
22. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Post Closing Trial Balance
Going-concern Assumptions
Long Term Investments
Partnership
23. Accounting information is based on cost with potential subsequent adjustments to fair value.
Full Disclosure Principle
Closing Entries
International Financial Reporting Standards
Measurement Principle
24. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Current Liabilities
Common Stock
Journal
Long Term Investments
25. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Statement of Cash Flows
Source Documents
Current Ratio
Debtors
26. 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.
Posting
CD (Certificate of Deposit)
Equity
Bonds
27. An expense that changes from period to perio - such as food or gasoline costs.
Shareholders
Unclassified Balance Sheets
Varaiable Expense
Financial Accounting
28. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
CD (Certificate of Deposit)
Corporation
Annual Financial Statements
Ledger
29. 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.
Business Entity Assumption
Deficit
Liabilities
Limited Liability Corporation
30. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Posting
Materiality Constraint
Natural Business Years
Securities
31. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Money Market Account
Expenses
Interim Financial Statements
Annual Financial Statements
32. Business owned by one person that is not organized as a corporation.
Present Value
Sole Proprietorship
Current Ratio
Secured Loan
33. The money left over when income exceeds expenditure.
Surplus
Accounting Period
Financial Accounting Standards Board
Adjusting Entry
34. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
Money Market Account
Liabilities
Contra Account
Accrued Expenses
35. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Acquisition
SEC (Securites and Exchange Commision)
Bookkeeping
Unadjusted Trial Balance
36. 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
Pro Forma Financial Statement
Current Ratio
Internal users
NASDAQ
37. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Double Entry Accounting
Bailout
Journal
Cash Basis Accounting
38. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Auditors
Revenues
Partnership
Post Closing Trial Balance
39. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Statement of Owner's Equity
Account
Accounting Cycle
Ledger
40. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Owner - Capital
Cost-benefit Constraint
Secured Loan
SEC (Securites and Exchange Commision)
41. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Journalizing
Partnership
Debit
Bonds
42. Optional entries recorded at the beginning of a period that prepare the accounts for the usual journal entries as if adjusting entries had not occurred in the prior period.
Creditors
Reversing Entries
Current Assets
Federal Reserve System
43. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Current Ratio
Common Stock
Ethics
Matching Principle
44. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Unsecured Loan
Bailout
Natural Business Years
IPO
45. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Business Entity Assumption
Cost-benefit Constraint
Partnership
Internal users
46. 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.
Internal transactions
NYSE (New York Stock Exchange)
Unclassified Balance Sheets
Pro Forma Financial Statement
47. A loan that is backed by collateral such as cars - houses - or other assets.
Mergers
Secured Loan
External Transactions
Time Period Assumptions
48. Excess of expenses over revenues for a period.
Passive Income
Liabilities
Net Loss
Long Term Investments
49. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Account
Bonds
Partnership
Bailout
50. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Recordkeeping
Working Papers
Sarbanes-Oxley Act (SOX)
Temporary Accounts