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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. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Statement of Cash Flows
Federal Reserve System
Return on Assets
Unearned Revenue
2. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Conceptual Framework
International Accounting Standards Board
Reversing Entries
Debt Ratio
3. Journal entries that affect at least three accounts.
Depreciation
Operating Cycle
Business Entity Assumption
Compound Journal Entries
4. An expense that changes from period to perio - such as food or gasoline costs.
Discretionary Income
SEC (Securites and Exchange Commision)
Varaiable Expense
Posting
5. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Cost Principle
Risk
Corporation
Accounting Period
6. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Acquisition
SMART Goal
Surplus
Stock
7. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.
Contra Account
Straight-line Depreciation Method
Owner Investment
Classified Balance Sheet
8. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
Time Period Assumptions
Ethics
Acquisition
Unearned Revenue
9. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Matching Principle
Double Entry Accounting
Cost Principle
Trial balance
10. 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.
Pro Forma Financial Statement
Accrued Revenues
Securities
Income Summary
11. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Deficit
SMART Goal
Current Liabilities
Present Value
12. Record containing all accounts (with amounts) for a business.
Ledger
Chart of Accounts
Fiscal Year
Unearned Revenue
13. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
NASDAQ
Business Entity Assumption
Accrued Revenues
Return on Assets
14. 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.
Straight-line Depreciation Method
Internal users
Preferred Stock
Adjusting Entry
15. Loaning or giving money to a business in orer to save it from bankruptcy.
Post Closing Trial Balance
Bailout
Events
Money Market Account
16. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Owner - Capital
Contra Account
Varaiable Expense
Credit
17. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Unearned Revenues
Time Period Assumptions
Partnership Agreement
Full Disclosure Principle
18. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Portfolio Income
Bailout
Plant Assets
Preferred Stock
19. Account showing the owner's claim on company assets; equals owner investments plus net income (or less net loss) minus owner withdrawals since the company's inception. Also called Equity.
Owner - Capital
Return
External Transactions
General Journal
20. 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
Sarbanes-Oxley Act (SOX)
Securities and Exchange Commission
Natural Business Years
Managerial Accounting
21. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Pro Forma Financial Statement
Common Stock
Depreciation
Unadjusted Trial Balance
22. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Working Papers
Balance Sheet
Internal transactions
Unearned Revenues
23. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Unclassified Balance Sheets
Journal
Compound Journal Entries
Revenues
24. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Shareholders
Owner Withdrawals
Balance Column Account
Long Term Liabilities
25. Gross increase in equity from a company's business activities that earn income.
Revenues
Full Disclosure Principle
Journalizing
Internal users
26. Owners of a corporation who usually receive dividends. Also called stockholders.
Shareholders
Portfolio Income
Long Term Investments
Book Value
27. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
International Financial Reporting Standards
Ledger
Prepaid Expenses
Cost-benefit Constraint
28. 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.
Time Period Assumptions
Mergers
Bonds
Partnership
29. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.
Straight-line Depreciation Method
Closing process
International Accounting Standards Board
Federal Reserve System
30. Principle that assumes transactions and events can be expressed in money units.
Depreciation
Monetary Unit Assumption
Sole Proprietorship
Creditors
31. Independent group of full-time members responsible for setting accounting rules.
Ledger
Financial Accounting Standards Board
Owner Withdrawals
Balance Column Account
32. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Debit
Profit Margin
Preferred Stock
Post Closing Trial Balance
33. Business owned by a single person.
Sole Propietorship
Revenues
Posting
International Accounting Standards Board
34. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
SEC (Securites and Exchange Commision)
Revenue Recognition Principle
Generally Accepted Accounting Principles
Monetary Unit Assumption
35. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Materiality Constraint
Mergers
Accounting Equation
Prepaid Expenses
36. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Expenses
Passive Income
Balance Column Account
Creditors
37. Goals that are specific - measurable - attainable - realistic - and time bound.
Accounting
Bookkeeping
Intangible assets
SMART Goal
38. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Recordkeeping
Net Income
Return on Assets
Plant Assets
39. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Operating Cycle
Accrual Basis Accounting
Ethical Dilemma
Accounting
40. Individuals or organizations that owe money.
NASDAQ
Trial balance
Acquisition
Debtors
41. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.
Operating Cycle
Business Entity Assumption
Annual Financial Statements
Shares
42. Individuals or organizations entitled to receive payments
Creditors
Securities and Exchange Commission
Materiality Constraint
International Financial Reporting Standards
43. Length of time covered by financial statements; also called reporting period.
Accounting Period
Surplus
Federal Reserve System
Equity
44. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Unclassified Balance Sheets
Adjusted Trial Balance
Posting Reference Column
Auditors
45. Income from investments - including dividends - interest - or the sale of a property.
Portfolio Income
Owner Withdrawals
Surplus
IRA (Individual Retirement Account)
46. Statements that show the effect of proposed transactions and events as if they had occurred.
Accrued Revenues
Internal users
Pro Forma Financial Statement
Balance Sheet
47. The principle prescribing that revenue is recognized when earned.
Revenue Recognition Principle
International Accounting Standards Board
Time Period Assumptions
Balance Column Account
48. 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
Portfolio Income
Partnership
Auditors
49. Report of changes in equity over a period; adjusted for increases and for decreases.
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50. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Accounting Cycle
Generally Accepted Accounting Principles
Account
Statement of Cash Flows