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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. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.
Ethical Dilemma
International Financial Reporting Standards
SMART Goal
Time Period Assumptions
2. The value of a future cash steam discounted at the appropriate market interest rate.
NASDAQ
Expense Recognition Principle
Present Value
Accrual Basis Accounting
3. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Debtors
Secured Loan
Conceptual Framework
Present Value
4. Exchanges of economic value between one entity and another entity.
Classified Balance Sheet
External Transactions
Mergers
Debit
5. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Internal users
Operating Cycle
Generally Accepted Accounting Principles
Intangible assets
6. An expense that changes from period to perio - such as food or gasoline costs.
Varaiable Expense
Double Entry Accounting
Permanent Accounts
Shareholders
7. Individuals or organizations entitled to receive payments
External Transactions
Chart of Accounts
Unsecured Loan
Creditors
8. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Business Entity Assumption
Full Disclosure Principle
Acquisition
Adjusted Trial Balance
9. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.
Common Stock
Annual Financial Statements
Risk
Journalizing
10. Happenings that both affect an organization's financial position and can be reliably measured.
Ethical Dilemma
Classified Balance Sheet
Events
Cost-benefit Constraint
11. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Money Market Account
Bailout
Ethics
Balance Column Account
12. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Surplus
Equity
Unsecured Loan
Working Papers
13. Record containing all accounts (with amounts) for a business.
Ledger
Posting
Owner Withdrawals
Business Entity Assumption
14. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Acquisition
Income Statement
Measurement Principle
Accounting Equation
15. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Working Papers
Current Assets
Securities and Exchange Commission
Deficit
16. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Managerial Accounting
Source Documents
Shareholders
Credit
17. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Varaiable Expense
Closing Entries
Balance Sheet
Long Term Investments
18. Income that is available after all of the essential financial commitments have been paid.
Discretionary Income
Corporation
Journal
Risk Tolerance
19. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Natural Business Years
Accrual Basis Accounting
Accrued Expenses
Debit
20. Individuals hired to review financial reports and information systems of organizations.
Shares
Bailout
Auditors
Reversing Entries
21. 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.
Matching Principle (or Expense Recognition Principle)
Accrued Revenues
Ethics
Cost-benefit Constraint
22. Income from investments - including dividends - interest - or the sale of a property.
Statement of Cash Flows
Depreciation
Long Term Investments
Portfolio Income
23. Assets pulled out of the business by the owner.
Matching Principle
Partnership
Monetary Unit Assumption
Owner Withdrawals
24. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Unearned Revenues
Going-concern Assumptions
Partnership
Return
25. A corporation's basic ownership share.
Common Stock
Measurement Principle
Accrued Revenues
Partnership Agreement
26. Ratio of total liabilities to total assets; used to reflect risk associated with a company's debts.
Debt Ratio
Liabilities
Discretionary Income
Source Documents
27. All purpose journal for recording the debits and credits of transactions and events.
General Journal
International Financial Reporting Standards
Matching Principle (or Expense Recognition Principle)
Long Term Investments
28. A legal entity that is seperate from its owners.
Corporations
Adjusting Entry
General Journal
Working Papers
29. 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.
Adjusting Entry
Recordkeeping
Current Ratio
Account Balance
30. Accounting information is based on cost with potential subsequent adjustments to fair value.
Net Income
Stockholders
Audit
Measurement Principle
31. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Financial Accounting Standards Board
Debtors
Current Ratio
Audit
32. Assets put into the business by the owner.
Risk
Owner Investment
Prepaid Expenses
Discretionary Income
33. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
International Financial Reporting Standards
Cost-benefit Constraint
Time Period Assumptions
Accounting Cycle
34. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Bookkeeping
Corporation
Posting Reference Column
Long Term Investments
35. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.
Net Income
Current Assets
Acquisition
Financial Accounting Standards Board
36. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Double Entry Accounting
Varaiable Expense
Unearned Revenues
Partnership
37. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Accounting
Money Market Account
Audit
Corporations
38. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.
Time Period Assumptions
Ethics
Intangible assets
Profit Margin
39. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Varaiable Expense
Post Closing Trial Balance
Portfolio Income
Depreciation
40. 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.
Ethical Dilemma
Owner - Capital
Cash Basis Accounting
Corporation
41. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Net Loss
Compound Journal Entries
Permanent Accounts
Interim Financial Statements
42. Owners of a corporation who usually receive dividends. Also called shareholders.
Stockholders
SEC (Securites and Exchange Commision)
SMART Goal
Chart of Accounts
43. Tool used to show the effects of transactions and events on individual accounts.
General Journal
T Account
Depreciation
External Transactions
44. Expenses that remain the same regardless of the circumstances.
Account
Current Assets
Annual Financial Statements
Fixed Expense
45. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Sole Proprietorship
SEC (Securites and Exchange Commision)
Unadjusted Trial Balance
Accounting
46. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Securities and Exchange Commission
Audit
Partnership
Owner - Capital
47. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Recordkeeping
Plant Assets
Current Assets
NYSE (New York Stock Exchange)
48. Process of recording transactions in a journal.
Fiscal Year
Journalizing
Natural Business Years
Financial Accounting Standards Board
49. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Revenues
Risk Tolerance
Materiality Constraint
Mergers
50. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.
IPO
Profit Margin
Classified Balance Sheet
Net Income