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






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






3. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.






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






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






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






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






8. An expense that changes from period to perio - such as food or gasoline costs.






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






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






11. 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.






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






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






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






15. Area of accounting aimed mainly at serving external users.






16. 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.






17. Excess of expenses over revenues for a period.






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






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






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






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






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






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






24. Income from investments - including dividends - interest - or the sale of a property.






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






26. 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.






27. Business owned by two or more people.






28. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.






29. Group that identifies preferred accounting practices and encourages global acceptance; issues the International Financial Reporting Standards.






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






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






32. 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.






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






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






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






36. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.






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






38. 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).






39. 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.






40. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.






41. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.






42. Assets = Liabilities + Equity; Equity equals [Owner capital - owner withdrawal + revenue - expenses] for a non-corporation; Equity equals [Contributed capital - retained earnings + revenue - expenses] for a corporation where dividends are subtracted






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






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






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






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






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






49. 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).






50. The twelve month period that ends when a company's sales activities are at their lowest point.