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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. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Current Ratio
Money Market Account
Shareholders
Mergers
2. 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.
Balance Sheet
Journalizing
Adjusting Entry
Revenues
3. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Accounting Period
Owner - Capital
Managerial Accounting
Unearned Revenue
4. Record of money deposited in a financeial instution for a state time perio at a fixe interest rate.
Stock
Return
CD (Certificate of Deposit)
Acquisition
5. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Plant Assets
Ethical Dilemma
Intangible assets
Permanent Accounts
6. Principle that prescribes financial statements (including notes) to report all relevant information about an entity's operations and financial condition.
Profit Margin
Unearned Revenues
Full Disclosure Principle
Net Income
7. Assets put into the business by the owner.
Post Closing Trial Balance
Owner - Capital
Sole Propietorship
Owner Investment
8. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Fixed Expense
Work Sheet
Source Documents
Book Value
9. Tool used to show the effects of transactions and events on individual accounts.
T Account
Managerial Accounting
Posting Reference Column
Bonds
10. Business owned by one person that is not organized as a corporation.
Sole Proprietorship
International Financial Reporting Standards
Matching Principle
Owner Investment
11. A legal entity that is seperate from its owners.
Internal transactions
Accounting Cycle
Passive Income
Corporations
12. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Working Papers
Accrued Expenses
Account Balance
Creditors
13. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Securities and Exchange Commission
Net Income
Internal users
Post Closing Trial Balance
14. Income that is available after all of the essential financial commitments have been paid.
Discretionary Income
Unearned Revenues
Financial Accounting Standards Board
Surplus
15. 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.
Reversing Entries
Sole Proprietorship
Internal users
T Account
16. 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).
Double Entry Accounting
Securities
Income Summary
Current Assets
17. Monies (or sums of money) received from an investment; often in percent form.
Monetary Unit Assumption
Posting
Return
NYSE (New York Stock Exchange)
18. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Ledger
Portfolio Income
Profit Margin
Closing process
19. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Bailout
Measurement Principle
Matching Principle
Posting Reference Column
20. A situation in which a person is faced with two convingin yet conflicting alternatives for the solution to a difficult problem.
Ethical Dilemma
Financial Accounting
Annual Financial Statements
Sole Proprietorship
21. Assets pulled out of the business by the owner.
Revenue Recognition Principle
Income Statement
Owner Withdrawals
Account
22. Persons using accounting information who are directly involved in managing the organization.
Internal users
Assets
Bookkeeping
Return on Assets
23. Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP.
Measurement Principle
Accounting
Accrual Basis Accounting
Owner Investment
24. Debt securities that are issued by a borrower to raise capital . Bonds guarantee payments of the original amount borrowe plus interest and/or repayable on a fixed rate when the bond matures.
Long Term Investments
Owner - Capital
Internal users
Bonds
25. A corporation's basic ownership share.
Unearned Revenue
Unsecured Loan
Assets
Common Stock
26. Individuals or organizations that owe money.
Securities
Owner - Capital
Debtors
Accounting Period
27. The first time a company sells shares of its stock to the public.
IPO
Cost Principle
Time Period Assumptions
Current Liabilities
28. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Common Stock
Accrued Expenses
Equity
Return on Assets
29. Excess of expenses over revenues for a period.
Creditors
Audit
Cash Basis Accounting
Net Loss
30. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.
Balance Column Account
Stockholders
Pro Forma Financial Statement
Credit
31. Expenses that remain the same regardless of the circumstances.
NASDAQ
Fixed Expense
Portfolio Income
Expanded Accounting Equation
32. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Credit
Partnership
Internal users
Unadjusted Trial Balance
33. Owners of a corporation who usually receive dividends. Also called shareholders.
Stockholders
Unclassified Balance Sheets
T Account
Ethics
34. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Discretionary Income
Plant Assets
Book Value
Accounting Period
35. A written framework to guide the development - preparation - and interpretation of financial accounting information.
Limited Liability Corporation
Classified Balance Sheet
Conceptual Framework
Income Statement
36. The money left over when income exceeds expenditure.
Debit
Net Loss
Journal
Surplus
37. Area of accounting aimed mainly at serving external users.
NYSE (New York Stock Exchange)
Risk
Internal users
Financial Accounting
38. The twelve month period that ends when a company's sales activities are at their lowest point.
Measurement Principle
Natural Business Years
Income Statement
Debtors
39. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Interim Financial Statements
Revenue Recognition Principle
Intangible assets
Bailout
40. Statements that show the effect of proposed transactions and events as if they had occurred.
Pro Forma Financial Statement
Bookkeeping
International Accounting Standards Board
Assets
41. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Limited Liability Corporation
SMART Goal
Source Documents
Prepaid Expenses
42. Loaning or giving money to a business in orer to save it from bankruptcy.
Assets
Materiality Constraint
Stock
Bailout
43. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Statement of Cash Flows
NYSE (New York Stock Exchange)
Journal
Contra Account
44. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
Trial balance
Unearned Revenues
Time Period Assumptions
Unadjusted Trial Balance
45. 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
Temporary Accounts
Permanent Accounts
Sarbanes-Oxley Act (SOX)
Preferred Stock
46. 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)
Source Documents
Monetary Unit Assumption
Current Liabilities
47. Journal entries that affect at least three accounts.
Compound Journal Entries
Plant Assets
Statement of Cash Flows
Surplus
48. Business owned by a single person.
Financial Accounting Standards Board
Sole Propietorship
Cash Basis Accounting
Acquisition
49. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
Classified Balance Sheet
Cash Basis Accounting
Pro Forma Financial Statement
Passive Income
50. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Partnership
Current Ratio
Events
Securities