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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. Business owned by one person that is not organized as a corporation.
SEC (Securites and Exchange Commision)
Surplus
Sole Proprietorship
NASDAQ
2. 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.
Expenses
Income Statement
Liabilities
Risk Tolerance
3. Process of recording transactions in a journal.
Journalizing
Double Entry Accounting
Materiality Constraint
Partnership
4. Assets put into the business by the owner.
Statement of Owner's Equity
Return
Owner Investment
Intangible assets
5. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Ledger
Book Value
Securities
Credit
6. Balance sheet that broadly groups assets - liabilities - and equity accounts.
External Users
Audit
Net Income
Unclassified Balance Sheets
7. 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
Ponzi Scheme
Reversing Entries
Sarbanes-Oxley Act (SOX)
Cost Principle
8. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Surplus
Shareholders
Permanent Accounts
Sarbanes-Oxley Act (SOX)
9. Persons using accounting information who are directly involved in managing the organization.
Internal users
Ethical Dilemma
Liabilities
Source Documents
10. Prescribes expenses to be reported in the same period as the revenues that were earned as a result of the expenses.
Matching Principle (or Expense Recognition Principle)
Unadjusted Trial Balance
Long Term Liabilities
Surplus
11. 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).
Going-concern Assumptions
Closing Entries
Statement of Cash Flows
Portfolio Income
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.
Chart of Accounts
Net Loss
Expenses
Liabilities
13. Individuals hired to review financial reports and information systems of organizations.
Post Closing Trial Balance
Common Stock
Auditors
Long Term Liabilities
14. Outflows or using up of assets as part of operations of business to generate sales.
Expenses
Stockholders
Plant Assets
Interim Financial Statements
15. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - and years.
Current Liabilities
Time Period Assumptions
Journal
Internal transactions
16. Journal entries that affect at least three accounts.
Compound Journal Entries
Cost Principle
Intangible assets
Time Period Assumptions
17. The combining of two or more comapnies into one larger company.
Mergers
Temporary Accounts
Partnership
Plant Assets
18. The principle prescribing that revenue is recognized when earned.
Annual Financial Statements
Revenue Recognition Principle
Current Ratio
Owner Withdrawals
19. Equity of a corporation divided into ownership units that usually give dividends. Also called Shares.
Bookkeeping
Chart of Accounts
Stock
Cost Principle
20. A type of savings account that offers higher interest rates - with higher minimum deposit levels than a regular savings account.
Contra Account
Ethics
Money Market Account
Business Entity Assumption
21. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Matching Principle (or Expense Recognition Principle)
Interim Financial Statements
Matching Principle
Securities
22. A financial statement that lists cash inflows and cash outflows during a period; arranged by operating - investing - and financing.
Contra Account
Cost-benefit Constraint
General Journal
Statement of Cash Flows
23. Length of time covered by financial statements; also called reporting period.
Accounting Period
Partnership
Ethics
Stockholders
24. Expense created by allocating the cost of plant and equipment to periods in which they are used. Represents the expense of using the asset.
Going-concern Assumptions
Classified Balance Sheet
Depreciation
Prepaid Expenses
25. Account with debit and credit columns for recording entries and another column for showing the balance of the account after each entry.
Balance Column Account
Account Balance
Reversing Entries
Net Income
26. Information and measurement system that identifies - records - and communicates relevant information about a company's business activities.
Accounting
Bailout
Annual Financial Statements
Debtors
27. Tool used to show the effects of transactions and events on individual accounts.
Liabilities
T Account
Acquisition
Monetary Unit Assumption
28. 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.
Financial Accounting
Adjusting Entry
Plant Assets
Matching Principle (or Expense Recognition Principle)
29. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Journal
External Transactions
Money Market Account
Stock
30. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
NASDAQ
Intangible assets
Journal
Operating Cycle
31. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.
Income Statement
Accounting Equation
Time Period Assumptions
Classified Balance Sheet
32. 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.
Conceptual Framework
IPO
Equity
Portfolio Income
33. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Time Period Assumptions
Adjusted Trial Balance
Ethical Dilemma
Measurement Principle
34. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Owner Withdrawals
Partnership
Trial balance
Sole Proprietorship
35. A legal entity that is seperate from its owners.
NYSE (New York Stock Exchange)
Accrued Revenues
Corporations
Income Statement
36. Financial statement that lists types and dollar amounts of assets - liabilities - and equity at a specific date.
Fiscal Year
Balance Sheet
Full Disclosure Principle
Net Loss
37. The first time a company sells shares of its stock to the public.
Matching Principle (or Expense Recognition Principle)
Journalizing
IPO
Expanded Accounting Equation
38. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Securities and Exchange Commission
Cash Basis Accounting
CD (Certificate of Deposit)
Owner Investment
39. A corporation's basic ownership share.
Expenses
Common Stock
Bailout
Intangible assets
40. Assets pulled out of the business by the owner.
Revenue Recognition Principle
Pro Forma Financial Statement
Partnership
Owner Withdrawals
41. A business structure that offers membership instead of shares - and combines limited liability protections with the tax from of a partneship.
Statement of Owner's Equity
Return
Revenue Recognition Principle
Limited Liability Corporation
42. Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders.
Acquisition
Corporation
Owner - Capital
Intangible assets
43. Loaning or giving money to a business in orer to save it from bankruptcy.
Bailout
Temporary Accounts
Owner - Capital
Operating Cycle
44. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Recordkeeping
Return
Pro Forma Financial Statement
Accrued Expenses
45. Recorded on the left side; an entry that increases asset and expense accounts - and decreases liability - revenue and most equity accounts. Abbreviated Dr.
Current Ratio
Fiscal Year
Cost-benefit Constraint
Debit
46. Individuals or organizations entitled to receive payments
Closing process
Creditors
Accrual Basis Accounting
Owner Investment
47. Earning received from rental property or other business activity where the individual is not actively involved (such as royalties from publishing a book)
Accounting Period
Ethical Dilemma
Passive Income
Partnership Agreement
48. Income that is available after all of the essential financial commitments have been paid.
Cost Principle
Current Ratio
Discretionary Income
Stock
49. Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses and increasing liabilities.
Current Ratio
Current Liabilities
Accrued Expenses
Current Assets
50. All purpose journal for recording the debits and credits of transactions and events.
SMART Goal
General Journal
Long Term Liabilities
Assets