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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. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.






2. 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.






3. Analysis and report of an organization's accounting system - its records - and its reports using various tests.






4. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.






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






6. 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.






7. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.






8. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.






9. The value of a future cash steam discounted at the appropriate market interest rate.






10. List of accounts and balances prepared after period-end adjustments are recorded and posted.






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






12. 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).






13. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.






14. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.






15. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.






16. List of accounts used by a company' includes and identification number for each account.






17. Owner's claim on the assets of a business; equals the residual interest in an entity's assets after deducting liabilities. Also called net assets.






18. Resources that a company owns or controls that are expected to provide current and future benefits to the business.






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






20. Expenses that remain the same regardless of the circumstances.






21. Statements that show the effect of proposed transactions and events as if they had occurred.






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






23. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.






24. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.






25. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.






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






27. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.






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






29. Individuals or organizations entitled to receive payments






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






31. 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).






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






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






34. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.






35. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.






36. The combining of two or more comapnies into one larger company.






37. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.






38. Rules that specify acceptable accounting practices.






39. Tool used to show the effects of transactions and events on individual accounts.






40. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.






41. A tax deferred account that allows individuals to plan for their retirement.






42. The money left over when income exceeds expenditure.






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






44. Owners of a corporation who usually receive dividends. Also called shareholders.






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






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






47. All purpose journal for recording the debits and credits of transactions and events.






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






49. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.






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