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DSST Principles Of Finance

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. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.






2. Assets pulled out of the business by the owner.






3. Process of recording transactions in a journal.






4. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.






5. Activities within an organization that can affect the accounting equation.






6. Report of changes in equity over a period; adjusted for increases and for decreases.

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7. Happenings that both affect an organization's financial position and can be reliably measured.






8. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.






9. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.






10. Accounting information is based on cost with potential subsequent adjustments to fair value.






11. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.






12. The first time a company sells shares of its stock to the public.






13. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.






14. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.






15. Individuals hired to review financial reports and information systems of organizations.






16. List of accounts and balances prepared before accounting adjustments are recorded and posted.






17. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.






18. Normal time between paying cash for merchandise or employee services and receiving cash from customers.






19. A security representing a share of ownership in a company - providing voting rights - and entitling the holer to a share of the company's success through dividends and/or capital appreciation.






20. Monies (or sums of money) received from an investment; often in percent form.






21. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.






22. Cash and other assets expected to be sold - collected - or used within one year or the company's operating cycle - whichever is longer.






23. 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






24. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.






25. Owners of a corporation who usually receive dividends. Also called stockholders.






26. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.






27. Assets put into the business by the owner.






28. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.






29. A written framework to guide the development - preparation - and interpretation of financial accounting information.






30. List of accounts and their balances at a point in time; total debit balances must equal total credit balances.






31. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.






32. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)






33. Persons using accounting information who are directly involved in managing the organization.






34. Independent group of full-time members responsible for setting accounting rules.






35. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.






36. 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.






37. The central bank of the United States - with 12 Federal Reserve branch banks located in major cities throughout the nation. It helps to regulate the US monetary and banking system.






38. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.






39. Principle that requires a business to be accounted for separately from its owner(s) and from any other entity.






40. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.






41. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.






42. Gross increase in equity from a company's business activities that earn income.






43. 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.






44. Excess of expenses over revenues for a period.






45. Persons using accounting information who are not directly involved in running the organization.






46. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.






47. 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






48. A legal entity that is seperate from its owners.






49. Process of transferring journal entry information to the ledger; computerized systems automate this process.






50. Entries recorded at the end of each accounting period to transfer end of period balances in revenue - gain - expense - loss - and withdrawal (dividend for a corporation) accounts to the capital account (to retain earnings for a corporation).