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Test your basic knowledge |
DSST Principles Of Finance
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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. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Unearned Revenue
General Journal
CD (Certificate of Deposit)
Current Ratio
2. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.
Working Papers
Ethical Dilemma
Limited Liability Corporation
Intangible assets
3. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Partnership
Money Market Account
Partnership Agreement
IPO
4. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Balance Sheet
Posting Reference Column
Fiscal Year
Current Ratio
5. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Operating Cycle
Debit
Business Entity Assumption
External Users
6. Record containing all accounts (with amounts) for a business.
Ledger
Cost-benefit Constraint
Financial Accounting Standards Board
Unearned Revenue
7. Activities within an organization that can affect the accounting equation.
Posting
Internal transactions
Balance Sheet
Expense Recognition Principle
8. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Pro Forma Financial Statement
Generally Accepted Accounting Principles
Accrual Basis Accounting
Working Papers
9. Length of time covered by financial statements; also called reporting period.
Depreciation
Cost-benefit Constraint
Contra Account
Accounting Period
10. Journal entry at the end of an accounting period to bring an asset or liability account to its proper amount and update the related expenses or revenue account.
Expanded Accounting Equation
International Accounting Standards Board
Financial Accounting Standards Board
Adjusting Entry
11. Items paid for in advance of receiving their benefits. Classified as assets.
Stockholders
Return
External Users
Prepaid Expenses
12. 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.
Audit
Ponzi Scheme
Work Sheet
International Financial Reporting Standards
13. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Unearned Revenue
Materiality Constraint
Ethical Dilemma
Interim Financial Statements
14. The first time a company sells shares of its stock to the public.
Balance Sheet
Journalizing
Current Assets
IPO
15. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenue
Income Statement
Adjusting Entry
Shareholders
16. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Federal Reserve System
Book Value
Balance Column Account
Securities
17. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Long Term Investments
T Account
Net Loss
Assets
18. 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
Accrued Expenses
Chart of Accounts
Preferred Stock
19. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Liabilities
Discretionary Income
Permanent Accounts
Unadjusted Trial Balance
20. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
Accrued Expenses
Account Balance
Audit
Measurement Principle
21. Owners of a corporation who usually receive dividends. Also called stockholders.
Shareholders
Income Statement
Varaiable Expense
Unclassified Balance Sheets
22. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Expense Recognition Principle.
Net Loss
Matching Principle
Materiality Constraint
Ethics
23. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Owner Withdrawals
Statement of Owner's Equity
Current Liabilities
Book Value
24. Income that is available after all of the essential financial commitments have been paid.
Auditors
CD (Certificate of Deposit)
Time Period Assumptions
Discretionary Income
25. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Surplus
Contra Account
Cash Basis Accounting
Time Period Assumptions
26. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Revenue Recognition Principle
Deficit
Unearned Revenues
Working Papers
27. Business owned by a single person.
Straight-line Depreciation Method
Sole Propietorship
Unadjusted Trial Balance
Sole Proprietorship
28. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
T Account
Owner Investment
Managerial Accounting
Interim Financial Statements
29. Rules that specify acceptable accounting practices.
Chart of Accounts
Posting
Risk Tolerance
Generally Accepted Accounting Principles
30. Principle that assumes transactions and events can be expressed in money units.
Equity
Monetary Unit Assumption
Events
Revenues
31. A legal entity that is seperate from its owners.
Posting
Accounting
Account
Corporations
32. 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
Unearned Revenue
SMART Goal
Varaiable Expense
33. Outflows or using up of assets as part of operations of business to generate sales.
Stock
Revenues
Passive Income
Expenses
34. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Unsecured Loan
Pro Forma Financial Statement
Unclassified Balance Sheets
Assets
35. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
Assets
Cost-benefit Constraint
Fiscal Year
Work Sheet
36. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Auditors
Going-concern Assumptions
Book Value
Interim Financial Statements
37. Obligations not due to be paid within one year or the operating cycle - whichever is longer.
Long Term Liabilities
Monetary Unit Assumption
CD (Certificate of Deposit)
Measurement Principle
38. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
Source Documents
Secured Loan
International Accounting Standards Board
External Transactions
39. Loaning or giving money to a business in orer to save it from bankruptcy.
NYSE (New York Stock Exchange)
Deficit
Source Documents
Bailout
40. Gross increase in equity from a company's business activities that earn income.
Stockholders
Depreciation
Revenues
Preferred Stock
41. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Monetary Unit Assumption
Owner - Capital
Acquisition
Passive Income
42. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
International Financial Reporting Standards
Income Summary
Closing process
Return on Assets
43. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Recordkeeping
Closing Entries
Full Disclosure Principle
Return on Assets
44. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Managerial Accounting
SEC (Securites and Exchange Commision)
General Journal
Statement of Owner's Equity
45. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Bailout
Matching Principle (or Expense Recognition Principle)
Accounting Equation
Unclassified Balance Sheets
46. Expenses that remain the same regardless of the circumstances.
Acquisition
Fixed Expense
Long Term Liabilities
Securities and Exchange Commission
47. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Current Liabilities
Net Loss
Statement of Cash Flows
Fiscal Year
48. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Owner Withdrawals
Account
Deficit
Posting Reference Column
49. List of accounts used by a company' includes and identification number for each account.
Natural Business Years
Chart of Accounts
Closing process
Risk
50. Tool used to show the effects of transactions and events on individual accounts.
Cost Principle
Ponzi Scheme
Unadjusted Trial Balance
T Account