Test your basic knowledge |

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






2. Principle that assumes transactions and events can be expressed in money units.






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






4. 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






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






6. 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.






7. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.






8. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.






9. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.






10. Area of accounting aimed mainly at serving the decision-making needs of internal users.






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






12. Goals that are specific - measurable - attainable - realistic - and time bound.






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






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






15. Balance sheet that broadly groups assets - liabilities - and equity accounts.






16. Loaning or giving money to a business in orer to save it from bankruptcy.






17. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.






18. 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.






19. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity






20. 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).






21. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.






22. A corporation's basic ownership share.






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






24. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.






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






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






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






28. An investment scam that uses the assets from new investors to make payments to older investors. Named after Charles Ponzi who used the technique in the early 1900s to defraud thousands of investors.






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






30. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.






31. Business owned by a single person.






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






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






34. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.






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






36. 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.






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






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






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






40. 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.






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






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






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






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






45. Income that is available after all of the essential financial commitments have been paid.






46. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.






47. 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.






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






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






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