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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. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Adjusting Entry
Ethics
Pro Forma Financial Statement
Current Ratio
2. Method that allocates an equal portion of the depreciable cost of plant asset (cost minus salvage) to each accounting period in its useful life.
Straight-line Depreciation Method
Return on Assets
Liabilities
Contra Account
3. Individuals hired to review financial reports and information systems of organizations.
Auditors
Liabilities
Closing Entries
Varaiable Expense
4. Sources of information in accounting entries that can be in either paper or electronic form. Also called business papers.
Source Documents
Managerial Accounting
Account
SEC (Securites and Exchange Commision)
5. Activities within an organization that can affect the accounting equation.
External Transactions
Bailout
Internal transactions
Current Ratio
6. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Income Summary
Account
Ethics
Book Value
7. Journal entries that affect at least three accounts.
Owner - Capital
Conceptual Framework
Straight-line Depreciation Method
Compound Journal Entries
8. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Ponzi Scheme
Return
Accounting Equation
Posting Reference Column
9. Accounting system that recognizes revenues when cash is received and records expenses when cash is paid.
International Financial Reporting Standards
Cost Principle
Cash Basis Accounting
Interim Financial Statements
10. Amount earned after subtracting all expenses necessary for and matched with sales for a period.
Financial Accounting
Portfolio Income
Sole Proprietorship
Net Income
11. Accounts that reflect activities related to one or more future periods; balance sheet accounts whose balances are not closed. Also called real accounts.
Posting
Permanent Accounts
T Account
Interim Financial Statements
12. Independent group of full-time members responsible for setting accounting rules.
SEC (Securites and Exchange Commision)
Going-concern Assumptions
Financial Accounting Standards Board
T Account
13. Process of recording transactions in a journal.
Journalizing
Money Market Account
Owner Investment
Generally Accepted Accounting Principles
14. Ratio reflecting operating efficiency; defined as net income divided by average total assets for that period.
Double Entry Accounting
Conceptual Framework
Stock
Return on Assets
15. Accounts used to record revenues - expenses - and withdrawals (dividends for a corporation). They are closed at the end of each period.
Straight-line Depreciation Method
Revenue Recognition Principle
Pro Forma Financial Statement
Temporary Accounts
16. Analysis and report of an organization's accounting system - its records - and its reports using various tests.
Creditors
Surplus
Net Loss
Audit
17. List of accounts and balances prepared before accounting adjustments are recorded and posted.
Balance Sheet
Work Sheet
Unadjusted Trial Balance
Bonds
18. Owners of a corporation who usually receive dividends. Also called shareholders.
Balance Sheet
Prepaid Expenses
Unearned Revenues
Stockholders
19. 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).
Income Summary
External Users
Unearned Revenue
NYSE (New York Stock Exchange)
20. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
International Accounting Standards Board
Ethical Dilemma
Recordkeeping
External Users
21. Difference between total debits and total credits (including the beginning balance) for an account.
Accrual Basis Accounting
Balance Column Account
Return
Account Balance
22. Unincorporated association of two or more persons to pursue a business for profit as co-owners.
Net Income
Equity
Fixed Expense
Partnership
23. List of accounts used by a company' includes and identification number for each account.
Return on Assets
Ethics
Posting Reference Column
Chart of Accounts
24. A column in journals in which individual ledger account numbers are entered when entries are posted to those ledger accounts.
Posting Reference Column
Account
Work Sheet
Accrued Revenues
25. An expense that changes from period to perio - such as food or gasoline costs.
Sole Propietorship
Owner Investment
Varaiable Expense
Post Closing Trial Balance
26. Accounting information is based on cost with potential subsequent adjustments to fair value.
Measurement Principle
Adjusting Entry
Surplus
Return on Assets
27. Federal agency Congress has charged to set reporting rules for organizations that sell ownership shares to the public.
Securities and Exchange Commission
Discretionary Income
Sarbanes-Oxley Act (SOX)
Natural Business Years
28. List of accounts and balances prepared after period-end adjustments are recorded and posted.
CD (Certificate of Deposit)
Post Closing Trial Balance
Adjusted Trial Balance
Portfolio Income
29. Tangible long lived assets used to produce or sell products and services; also called property - plant - and equipment or fixed assets.
Plant Assets
Bailout
Trial balance
Accounting
30. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Preferred Stock
Contra Account
Partnership
International Financial Reporting Standards
31. The first time a company sells shares of its stock to the public.
Adjusted Trial Balance
Events
IPO
Federal Reserve System
32. Recurring steps performed each accounting period - starting with analyzing transactions and continuing through the post closing trial balance (or reversing entries).
Classified Balance Sheet
General Journal
Time Period Assumptions
Accounting Cycle
33. A tax deferred account that allows individuals to plan for their retirement.
Closing process
IRA (Individual Retirement Account)
SMART Goal
Events
34. Happenings that both affect an organization's financial position and can be reliably measured.
Reversing Entries
Journal
Measurement Principle
Events
35. Individuals or organizations that owe money.
Ethical Dilemma
Stock
Debtors
Return on Assets
36. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Journal
Cash Basis Accounting
Accounting Cycle
Debtors
37. Assets pulled out of the business by the owner.
Limited Liability Corporation
Unearned Revenues
Owner Withdrawals
Equity
38. Code of conduct by which actions are judged as right or wrong - fair or unfair - honest or dishonest.
Common Stock
Closing process
Ethics
Common Stock
39. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
Income Summary
Ethical Dilemma
Work Sheet
IRA (Individual Retirement Account)
40. 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.
Bailout
Statement of Owner's Equity
Bonds
Prepaid Expenses
41. 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.
Income Statement
Journalizing
Ethical Dilemma
Secured Loan
42. A corporation's basic ownership share.
Full Disclosure Principle
Common Stock
Debt Ratio
Matching Principle
43. 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.
Permanent Accounts
Ponzi Scheme
Pro Forma Financial Statement
Posting
44. The value of a future cash steam discounted at the appropriate market interest rate.
Income Statement
Accrued Expenses
Unadjusted Trial Balance
Present Value
45. Obligations due to be paid or settled within one year or the company's operating cycle - whichever is longer.
Temporary Accounts
Current Liabilities
Equity
Account
46. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Bonds
Closing Entries
Interim Financial Statements
Stock
47. 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.
Net Loss
Closing Entries
Matching Principle (or Expense Recognition Principle)
NYSE (New York Stock Exchange)
48. Monies (or sums of money) received from an investment; often in percent form.
Unearned Revenue
Return
Prepaid Expenses
Profit Margin
49. Accounting principle that prescribes financial statement information to be based on actual costs incurred in business transactions.
Debtors
Cash Basis Accounting
Cost Principle
Double Entry Accounting
50. The notion that only information with benefits of disclosure greater than the costs of disclosure need to be disclosed.
Compound Journal Entries
Cost-benefit Constraint
Portfolio Income
Plant Assets