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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. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.
International Financial Reporting Standards
Internal users
Accrued Expenses
Closing process
2. List of accounts used by a company' includes and identification number for each account.
Conceptual Framework
Chart of Accounts
Monetary Unit Assumption
Permanent Accounts
3. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Classified Balance Sheet
Assets
Measurement Principle
Accounting
4. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Journal
Ethics
Interim Financial Statements
Assets
5. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenues
Income Statement
Pro Forma Financial Statement
Audit
6. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Ethical Dilemma
Auditors
Sole Proprietorship
Ledger
7. Exchanges of economic value between one entity and another entity.
External Transactions
Assets
Chart of Accounts
Common Stock
8. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Long Term Liabilities
Journal
Corporations
Monetary Unit Assumption
9. Excess of expenses over revenues for a period.
Account Balance
Accounting Period
Net Loss
Debt Ratio
10. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Accounting Equation
Credit
Financial Accounting Standards Board
Sole Proprietorship
11. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Current Ratio
Accrual Basis Accounting
Accounting Period
Secured Loan
12. Area of accounting aimed mainly at serving external users.
Financial Accounting
Current Liabilities
Cash Basis Accounting
Fiscal Year
13. 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
Recordkeeping
Cost-benefit Constraint
Matching Principle
Expanded Accounting Equation
14. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Bookkeeping
SMART Goal
Matching Principle
Present Value
15. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Partnership Agreement
Deficit
Cash Basis Accounting
Materiality Constraint
16. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Accrual Basis Accounting
Debt Ratio
Risk
Going-concern Assumptions
17. 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.
Fixed Expense
Partnership
Profit Margin
Expense Recognition Principle
18. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Contra Account
Creditors
Closing Entries
Profit Margin
19. Uncertainty about expected return.
Risk
Securities
SEC (Securites and Exchange Commision)
Current Liabilities
20. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Time Period Assumptions
Reversing Entries
Long Term Investments
Measurement Principle
21. 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.
Managerial Accounting
Sarbanes-Oxley Act (SOX)
Classified Balance Sheet
Reversing Entries
22. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Net Loss
Balance Column Account
Adjusting Entry
Long Term Investments
23. The first time a company sells shares of its stock to the public.
IPO
Journalizing
Corporation
Adjusting Entry
24. A corporation's basic ownership share.
Common Stock
Creditors
Permanent Accounts
Owner - Capital
25. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Balance Sheet
Corporation
Limited Liability Corporation
Prepaid Expenses
26. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unadjusted Trial Balance
Bonds
Unearned Revenue
Debit
27. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Unearned Revenues
Prepaid Expenses
Liabilities
Unadjusted Trial Balance
28. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Owner Withdrawals
Conceptual Framework
Generally Accepted Accounting Principles
Sarbanes-Oxley Act (SOX)
29. A loan that is backed by collateral such as cars - houses - or other assets.
Intangible assets
Secured Loan
Current Liabilities
Unadjusted Trial Balance
30. Assets put into the business by the owner.
Revenue Recognition Principle
Operating Cycle
Owner Investment
Return
31. Expenses that remain the same regardless of the circumstances.
Owner Investment
Fixed Expense
Business Entity Assumption
Ledger
32. Business owned by two or more people.
Bailout
IPO
Creditors
Partnership
33. 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.
Debt Ratio
Adjusting Entry
Annual Financial Statements
NYSE (New York Stock Exchange)
34. 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.
Liabilities
Depreciation
Sarbanes-Oxley Act (SOX)
Prepaid Expenses
35. Record containing all accounts (with amounts) for a business.
Adjusted Trial Balance
Unearned Revenues
Ledger
Federal Reserve System
36. Business owned by one person that is not organized as a corporation.
Accounting Period
Long Term Liabilities
Return
Sole Proprietorship
37. Persons using accounting information who are directly involved in managing the organization.
Unearned Revenues
Internal users
Present Value
Secured Loan
38. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Owner - Capital
Securities and Exchange Commission
Owner Investment
Long Term Investments
39. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
Annual Financial Statements
Revenues
Reversing Entries
Ethics
40. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Ponzi Scheme
Debit
Stock
Unsecured Loan
41. Outflows or using up of assets as part of operations of business to generate sales.
Expenses
Going-concern Assumptions
Equity
Risk Tolerance
42. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
NYSE (New York Stock Exchange)
Accounting Equation
CD (Certificate of Deposit)
Present Value
43. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Partnership
Internal transactions
Income Summary
Owner Investment
44. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Debit
Prepaid Expenses
Chart of Accounts
Time Period Assumptions
45. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
International Accounting Standards Board
Assets
Securities and Exchange Commission
Classified Balance Sheet
46. The twelve month period that ends when a company's sales activities are at their lowest point.
Passive Income
Preferred Stock
Natural Business Years
Bailout
47. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Credit
Profit Margin
Double Entry Accounting
Statement of Cash Flows
48. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Accrual Basis Accounting
General Journal
Limited Liability Corporation
Unearned Revenues
49. The money left over when income exceeds expenditure.
Owner - Capital
Assets
Partnership Agreement
Surplus
50. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Shareholders
Book Value
Straight-line Depreciation Method
Securities