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Test your basic knowledge |
DSST Principles Of Finance
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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. 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.
Managerial Accounting
Common Stock
Fiscal Year
Sarbanes-Oxley Act (SOX)
2. 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).
Accounting
Income Summary
Adjusted Trial Balance
Account Balance
3. Loaning or giving money to a business in orer to save it from bankruptcy.
Bailout
NASDAQ
Current Liabilities
Debtors
4. A federal agency that is responsible for regulating the securities industry an enforcing federal securites laws.
Post Closing Trial Balance
Portfolio Income
Sole Proprietorship
SEC (Securites and Exchange Commision)
5. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.
Discretionary Income
Sole Proprietorship
Cost Principle
Return on Assets
6. Individuals or organizations that owe money.
Pro Forma Financial Statement
Cost Principle
Debtors
Discretionary Income
7. Long term assets not used in operating activities such as notes receivable and investments in stocks and bonds.
Cash Basis Accounting
Fiscal Year
Long Term Investments
IRA (Individual Retirement Account)
8. Statements that show the effect of proposed transactions and events as if they had occurred.
Cost-benefit Constraint
Time Period Assumptions
Classified Balance Sheet
Pro Forma Financial Statement
9. The combining of two or more comapnies into one larger company.
Unclassified Balance Sheets
Stockholders
Mergers
Corporation
10. Principle that prescribes financial statements to reflect the assumption that the business will continue operating.
External Transactions
Going-concern Assumptions
NYSE (New York Stock Exchange)
Work Sheet
11. Persons using accounting information who are not directly involved in running the organization.
Debt Ratio
Shareholders
External Users
Matching Principle (or Expense Recognition Principle)
12. The NYSE was founded in 1792 and is the oldest and larvest securities market in the United States. it is located on Wall Street in New York.
NYSE (New York Stock Exchange)
Accounting Equation
Current Liabilities
International Financial Reporting Standards
13. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Full Disclosure Principle
Creditors
Equity
Secured Loan
14. 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.
Source Documents
Federal Reserve System
Time Period Assumptions
Ethics
15. Activities within an organization that can affect the accounting equation.
Owner - Capital
Internal transactions
Fiscal Year
Closing Entries
16. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Statement of Cash Flows
Stock
Income Statement
Profit Margin
17. Assets put into the business by the owner.
Double Entry Accounting
Financial Accounting Standards Board
Interim Financial Statements
Owner Investment
18. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Shareholders
Limited Liability Corporation
Balance Sheet
Securities and Exchange Commission
19. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Posting Reference Column
Current Ratio
Reversing Entries
Secured Loan
20. The money left over when income exceeds expenditure.
Account
Materiality Constraint
Surplus
Risk
21. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Natural Business Years
Fixed Expense
Deficit
Account Balance
22. Business owned by one person that is not organized as a corporation.
Sole Proprietorship
Operating Cycle
Events
Ethics
23. 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.
Expense Recognition Principle
Posting Reference Column
Post Closing Trial Balance
T Account
24. Report of changes in equity over a period; adjusted for increases and for decreases.
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25. 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).
Equity
Acquisition
Full Disclosure Principle
Closing Entries
26. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Current Liabilities
Financial Accounting Standards Board
Recordkeeping
Cost-benefit Constraint
27. Principle that assumes transactions and events can be expressed in money units.
Partnership
Surplus
Business Entity Assumption
Monetary Unit Assumption
28. Area of accounting aimed mainly at serving external users.
Ethics
Financial Accounting
Depreciation
Accounting
29. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Accrued Revenues
Expenses
Unadjusted Trial Balance
Source Documents
30. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Annual Financial Statements
Permanent Accounts
Balance Column Account
Managerial Accounting
31. Balance sheet that broadly groups assets - liabilities - and equity accounts.
Cash Basis Accounting
T Account
Income Summary
Unclassified Balance Sheets
32. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Credit
Accounting Equation
Monetary Unit Assumption
Securities and Exchange Commission
33. The act one corporation acquiring another through the purchase of its shares - or by purchasing its assets.
Long Term Liabilities
IRA (Individual Retirement Account)
Acquisition
Account
34. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Income Statement
IRA (Individual Retirement Account)
Interim Financial Statements
Risk
35. 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.
Ponzi Scheme
Permanent Accounts
Managerial Accounting
Creditors
36. Accounting system in which each transaction affects at least two accounts and has at least one debit and one credit.
Sarbanes-Oxley Act (SOX)
Double Entry Accounting
Monetary Unit Assumption
Discretionary Income
37. Uncertainty about expected return.
Risk
Recordkeeping
Secured Loan
Bonds
38. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Statement of Cash Flows
Posting Reference Column
Trial balance
CD (Certificate of Deposit)
39. 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
Bonds
Temporary Accounts
Preferred Stock
Adjusting Entry
40. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Journalizing
Securities
Unadjusted Trial Balance
Account
41. Process of transferring journal entry information to the ledger; computerized systems automate this process.
Passive Income
Posting
T Account
Net Loss
42. Excess of expenses over revenues for a period.
Net Loss
Unclassified Balance Sheets
Trial balance
Sole Propietorship
43. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Classified Balance Sheet
Adjusted Trial Balance
Cost-benefit Constraint
SMART Goal
44. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Debit
Profit Margin
Materiality Constraint
Risk Tolerance
45. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Accounting Cycle
Ledger
NYSE (New York Stock Exchange)
Working Papers
46. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Ponzi Scheme
Net Loss
Passive Income
Auditors
47. A loan that is not backed by collateral - but by the promise of the borrower to repay it.
Expenses
Bookkeeping
Internal users
Unsecured Loan
48. 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.
Ponzi Scheme
Bonds
International Financial Reporting Standards
Full Disclosure Principle
49. The value of a future cash steam discounted at the appropriate market interest rate.
Auditors
Operating Cycle
Present Value
Liabilities
50. Owners of a corporation who usually receive dividends. Also called shareholders.
External Transactions
Stockholders
Chart of Accounts
Surplus