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






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






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

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4. 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






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. Business owned by one person that is not organized as a corporation.






7. Long Term assets (resources) used to produce or sell products or services. Usually lack physical form and have uncertain benefits.






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






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






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






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






12. 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.






13. 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.






14. 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.






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






16. Obligations not due to be paid within one year or the operating cycle - whichever is longer.






17. Journal entries that affect at least three accounts.






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






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






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






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






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






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






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






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






26. The principle prescribing that revenue is recognized when earned.






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






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






29. 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.






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






31. 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.






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






33. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Expense Recognition Principle.






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






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






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






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






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






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






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






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






42. Unincorporated association of two or more persons to pursue a business for profit as co-owners.






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






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






45. Amount earned after subtracting all expenses necessary for and matched with sales for a period.






46. 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).






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






48. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.






49. The money left over when income exceeds expenditure.






50. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).