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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. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Account
Statement of Cash Flows
Assets
Securities and Exchange Commission
2. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
Bookkeeping
Cost Principle
Stock
Compound Journal Entries
3. Persons using accounting information who are not directly involved in running the organization.
Trial balance
Accrued Revenues
External Users
Unadjusted Trial Balance
4. Financial statements covering one-year period; often based on a calendar year - but any consecutive 12-month (or 52 week) period is acceptable.
Annual Financial Statements
Ethics
Partnership
IPO
5. Report of changes in equity over a period; adjusted for increases and for decreases.
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6. Owners of a corporation who usually receive dividends. Also called stockholders.
Equity
Owner Investment
Shareholders
Time Period Assumptions
7. The money left over when income exceeds expenditure.
Surplus
Adjusted Trial Balance
Income Summary
Accounting Period
8. Necessary end of period steps to prepare the accounts for recording the transactions of the next period.
Fixed Expense
Secured Loan
Closing process
Classified Balance Sheet
9. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Closing process
Securities
Financial Accounting Standards Board
Long Term Liabilities
10. The principle prescribing that revenue is recognized when earned.
Revenue Recognition Principle
Balance Column Account
Permanent Accounts
Unearned Revenues
11. Statements that show the effect of proposed transactions and events as if they had occurred.
Pro Forma Financial Statement
Accrual Basis Accounting
Statement of Owner's Equity
Ethical Dilemma
12. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Recordkeeping
Closing process
Managerial Accounting
Unclassified Balance Sheets
13. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
Adjusted Trial Balance
Measurement Principle
Going-concern Assumptions
Debit
14. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Cost-benefit Constraint
Risk Tolerance
Cash Basis Accounting
Conceptual Framework
15. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Matching Principle
T Account
Income Summary
Ethical Dilemma
16. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Shares
External Transactions
Measurement Principle
Bonds
17. An expense that changes from period to perio - such as food or gasoline costs.
Varaiable Expense
Sole Proprietorship
Measurement Principle
Deficit
18. The first time a company sells shares of its stock to the public.
Measurement Principle
IPO
Bookkeeping
Present Value
19. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Fixed Expense
Common Stock
Income Summary
Straight-line Depreciation Method
20. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Accounting Cycle
Owner Investment
Time Period Assumptions
Operating Cycle
21. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Ledger
Statement of Owner's Equity
Balance Sheet
Deficit
22. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Unearned Revenue
Chart of Accounts
Financial Accounting Standards Board
Interim Financial Statements
23. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
Cost-benefit Constraint
International Accounting Standards Board
Business Entity Assumption
Money Market Account
24. Financial statement that subtracts expenses from revenues to yield a net income or loss over a specified period of time; also includes any gains or losses.
Income Statement
Time Period Assumptions
Accrued Revenues
International Accounting Standards Board
25. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Fiscal Year
Internal transactions
Time Period Assumptions
Current Ratio
26. A loan that is backed by collateral such as cars - houses - or other assets.
Ledger
Annual Financial Statements
Secured Loan
Risk Tolerance
27. A meausre if an investor's ability to cope with fluctations in the value of their portfolio.
Portfolio Income
Risk Tolerance
Balance Sheet
Accounting
28. Difference between total debits and total credits (including the beginning balance) for an account.
Account Balance
Accrued Expenses
Adjusted Trial Balance
External Users
29. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Long Term Liabilities
Expenses
IPO
Adjusted Trial Balance
30. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Posting
Owner Investment
Account
Sole Propietorship
31. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Depreciation
Closing Entries
SMART Goal
Chart of Accounts
32. Prescribes that accounting for items that significantly impact a financial statement and any inferences from them adhere strictly to GAAP.
Accounting Cycle
Current Ratio
Materiality Constraint
Ethical Dilemma
33. Area of accounting aimed mainly at serving the decision-making needs of internal users.
Ethics
Owner Withdrawals
Managerial Accounting
Events
34. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Interim Financial Statements
Limited Liability Corporation
Current Ratio
Passive Income
35. 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.
Intangible assets
Federal Reserve System
Revenues
Mergers
36. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Expense Recognition Principle
Assets
Unsecured Loan
Corporations
37. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Shares
Current Liabilities
Source Documents
Net Income
38. Outflows or using up of assets as part of operations of business to generate sales.
IRA (Individual Retirement Account)
Monetary Unit Assumption
Permanent Accounts
Expenses
39. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Book Value
Natural Business Years
Permanent Accounts
Preferred Stock
40. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Assets
Work Sheet
Operating Cycle
Partnership Agreement
41. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Statement of Cash Flows
Posting Reference Column
Long Term Liabilities
Corporation
42. A tax deferred account that allows individuals to plan for their retirement.
Limited Liability Corporation
Depreciation
IRA (Individual Retirement Account)
Income Summary
43. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Liabilities
IPO
Unadjusted Trial Balance
NYSE (New York Stock Exchange)
44. A contract (usually drawn up by a lawyer) that staes how the partnership will be organized.
Accounting Cycle
Partnership Agreement
Ledger
Trial balance
45. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
Long Term Liabilities
Accrued Expenses
Account
Generally Accepted Accounting Principles
46. Area of accounting aimed mainly at serving external users.
NASDAQ
Return
Financial Accounting
Account Balance
47. Monies (or sums of money) received from an investment; often in percent form.
Internal users
Return
Securities and Exchange Commission
Work Sheet
48. 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.
Revenues
Mergers
Present Value
Adjusting Entry
49. Loaning or giving money to a business in orer to save it from bankruptcy.
Risk Tolerance
Auditors
Bailout
Cost Principle
50. 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
NASDAQ
Internal users
Natural Business Years
T Account