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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. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Balance Column Account
Sole Proprietorship
Going-concern Assumptions
Current Ratio
2. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Conceptual Framework
Natural Business Years
Balance Sheet
External Users
3. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Managerial Accounting
Partnership
Contra Account
Unearned Revenue
4. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Operating Cycle
Unadjusted Trial Balance
Statement of Cash Flows
Going-concern Assumptions
5. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.
Cash Basis Accounting
Fiscal Year
Work Sheet
Internal transactions
6. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Working Papers
Accounting
Adjusted Trial Balance
Closing Entries
7. A corporation's basic ownership share.
Post Closing Trial Balance
Trial balance
Common Stock
Interim Financial Statements
8. 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.
International Financial Reporting Standards
Acquisition
Present Value
Unsecured Loan
9. 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
External Users
NASDAQ
Annual Financial Statements
Time Period Assumptions
10. List of accounts used by a company' includes and identification number for each account.
Measurement Principle
Credit
Account Balance
Chart of Accounts
11. Excess of expenses over revenues for a period.
Net Loss
Cost-benefit Constraint
Statement of Cash Flows
IPO
12. Independent group of full-time members responsible for setting accounting rules.
Revenues
Shareholders
Financial Accounting Standards Board
Expanded Accounting Equation
13. Length of time covered by financial statements; also called reporting period.
Accounting Period
Work Sheet
Partnership
Profit Margin
14. Gross increase in equity from a company's business activities that earn income.
Balance Column Account
Revenues
Passive Income
Cost Principle
15. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Business Entity Assumption
Partnership Agreement
Time Period Assumptions
Double Entry Accounting
16. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
SMART Goal
Passive Income
Net Income
Cash Basis Accounting
17. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Current Ratio
Going-concern Assumptions
Mergers
Shareholders
18. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Sole Proprietorship
Owner Investment
Expense Recognition Principle
Net Income
19. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.
Debt Ratio
Debit
Account
Straight-line Depreciation Method
20. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Unsecured Loan
International Financial Reporting Standards
Recordkeeping
Accounting Equation
21. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Accrual Basis Accounting
Matching Principle (or Expense Recognition Principle)
External Transactions
Prepaid Expenses
22. Principle that assumes transactions and events can be expressed in money units.
External Transactions
Monetary Unit Assumption
Corporation
Return
23. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Posting
Partnership
Ethical Dilemma
Passive Income
24. 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
Limited Liability Corporation
Preferred Stock
Time Period Assumptions
Adjusted Trial Balance
25. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Limited Liability Corporation
Closing Entries
Ponzi Scheme
Present Value
26. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Full Disclosure Principle
Money Market Account
Managerial Accounting
Secured Loan
27. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Cash Basis Accounting
Double Entry Accounting
Unearned Revenue
Net Income
28. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Depreciation
IPO
Corporations
Common Stock
29. Journal entries that affect at least three accounts.
Sarbanes-Oxley Act (SOX)
Compound Journal Entries
Temporary Accounts
Bookkeeping
30. Accounting information is based on cost with potential subsequent adjustments to fair value.
Assets
Closing process
Measurement Principle
Compound Journal Entries
31. Goals that are specific - measurable - attainable - realistic - and time bound.
NYSE (New York Stock Exchange)
SMART Goal
Federal Reserve System
Double Entry Accounting
32. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Preferred Stock
Internal users
Cash Basis Accounting
Statement of Cash Flows
33. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Accrued Revenues
Long Term Investments
Adjusted Trial Balance
Sole Propietorship
34. Report of changes in equity over a period; adjusted for increases and for decreases.
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35. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Corporation
Expanded Accounting Equation
Accrual Basis Accounting
Compound Journal Entries
36. Outflows or using up of assets as part of operations of business to generate sales.
Matching Principle (or Expense Recognition Principle)
Present Value
Current Liabilities
Expenses
37. Individuals hired to review financial reports and information systems of organizations.
Partnership Agreement
Accrued Revenues
Ledger
Auditors
38. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Balance Column Account
Balance Sheet
Materiality Constraint
Cost-benefit Constraint
39. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Expanded Accounting Equation
NASDAQ
Sarbanes-Oxley Act (SOX)
Double Entry Accounting
40. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Partnership Agreement
Managerial Accounting
Varaiable Expense
Current Assets
41. Monies (or sums of money) received from an investment; often in percent form.
Return
Varaiable Expense
Reversing Entries
Net Income
42. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
NASDAQ
Conceptual Framework
Ponzi Scheme
Shares
43. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.
Internal transactions
Contra Account
Mergers
Intangible assets
44. Area of accounting aimed mainly at serving external users.
Financial Accounting
Closing process
Full Disclosure Principle
External Users
45. Persons using accounting information who are directly involved in managing the organization.
Money Market Account
Internal users
Internal transactions
Fixed Expense
46. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Full Disclosure Principle
Closing process
Accounting Equation
Long Term Investments
47. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Financial Accounting
Return on Assets
Assets
Adjusting Entry
48. Items paid for in advance of receiving their benefits. Classified as assets.
Credit
Audit
Prepaid Expenses
Secured Loan
49. 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.
CD (Certificate of Deposit)
Owner Withdrawals
Equity
Creditors
50. Rules that specify acceptable accounting practices.
NYSE (New York Stock Exchange)
Post Closing Trial Balance
Generally Accepted Accounting Principles
Journalizing