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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. Consecutive 12-month (or 52 week) period chosen as the organization's annual accounting period.
Fiscal Year
Trial balance
Cost-benefit Constraint
Risk Tolerance
2. Owners of a corporation who usually receive dividends. Also called stockholders.
Accrued Revenues
Closing Entries
Trial balance
Shareholders
3. A financial shortage that occurs when liabilities exceed assets or when cash inflows are less than cash outflows.
Deficit
Ponzi Scheme
Posting Reference Column
NASDAQ
4. The value of a future cash steam discounted at the appropriate market interest rate.
Full Disclosure Principle
Unclassified Balance Sheets
Account
Present Value
5. Individuals or organizations entitled to receive payments
Creditors
Pro Forma Financial Statement
Long Term Liabilities
Accounting Period
6. The part of accounting that involves recording transactions and events either manually or electronically. Also called Bookkeeping.
Balance Column Account
Expenses
Closing Entries
Recordkeeping
7. The money left over when income exceeds expenditure.
Sole Proprietorship
Surplus
Net Loss
NYSE (New York Stock Exchange)
8. Spreadsheets used to draft an unadjusted trial balance - adjusting entries - adjusted trial balance - and financial statements.
T Account
Annual Financial Statements
Work Sheet
Debt Ratio
9. Normal time between paying cash for merchandise or employee services and receiving cash from customers.
Interim Financial Statements
Operating Cycle
Assets
Preferred Stock
10. Record within an accounting system in which increases and decreases are entered and stored in a specific asset - liability - equity - revenue - or expense.
Owner Investment
Journal
Preferred Stock
Account
11. Excess of expenses over revenues for a period.
Unsecured Loan
Net Loss
Accrued Revenues
International Financial Reporting Standards
12. Analyses and other informal reports prepared by accountants and managers when organizing information for formal reports and financial statements.
Working Papers
Posting Reference Column
Accounting
Net Loss
13. 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.
Double Entry Accounting
Posting Reference Column
Equity
Fiscal Year
14. Equity of a corporation divided into ownership units that usually give dividends. Also called Stock.
Risk
Deficit
Shares
Accounting Period
15. Uncertainty about expected return.
Ponzi Scheme
Liabilities
Owner Withdrawals
Risk
16. Business owned by a single person.
NYSE (New York Stock Exchange)
Sole Propietorship
Shares
Matching Principle (or Expense Recognition Principle)
17. Length of time covered by financial statements; also called reporting period.
Accounting Period
Managerial Accounting
Long Term Liabilities
Common Stock
18. Recorded on the right side; an entry that decreases asset and expense accounts - and increases liability - revenue and most equity accounts. Abbreviated Cr.
Credit
Limited Liability Corporation
Unearned Revenues
Time Period Assumptions
19. Assumption that an organization's activities can be divided into specific time periods such as months - quarters - or years.
CD (Certificate of Deposit)
Time Period Assumptions
Accounting
Double Entry Accounting
20. List of accounts and balances prepared after period-end adjustments are recorded and posted.
Adjusting Entry
Credit
Adjusted Trial Balance
Posting
21. A loan that is backed by collateral such as cars - houses - or other assets.
Financial Accounting Standards Board
Bailout
Closing process
Secured Loan
22. 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
Debt Ratio
Account Balance
Preferred Stock
Deficit
23. An expense that changes from period to perio - such as food or gasoline costs.
Accounting Equation
T Account
Varaiable Expense
Account Balance
24. Area of accounting aimed mainly at serving external users.
Corporations
Unearned Revenues
Financial Accounting
Partnership
25. Assets acquisition costs less its accumulated depreciation - depletion - or amortization. Also sometimes used synonymously as the carrying value of an account.
Book Value
Journalizing
Unadjusted Trial Balance
Passive Income
26. Financial instruments such as stocks - bonds - and mutual funds that are traded in a stock exchange.
Sole Proprietorship
Sole Propietorship
Limited Liability Corporation
Securities
27. Account linked with another account and having an opposite normal balance. Reported as a subtraction from the other account's normal balance.
Contra Account
Adjusting Entry
Depreciation
Journalizing
28. List of accounts and balances prepared before accounting adjustments are recorded and posted.
External Transactions
Unadjusted Trial Balance
Financial Accounting
External Users
29. 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.
Common Stock
Matching Principle (or Expense Recognition Principle)
Federal Reserve System
Reversing Entries
30. Accounting information is based on cost with potential subsequent adjustments to fair value.
Measurement Principle
Time Period Assumptions
Revenues
Revenue Recognition Principle
31. Loaning or giving money to a business in orer to save it from bankruptcy.
Business Entity Assumption
Generally Accepted Accounting Principles
Intangible assets
Bailout
32. List of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Post Closing Trial Balance
Classified Balance Sheet
Fixed Expense
Posting Reference Column
33. Record in which trans actions are entered before they are posted to ledger accounts; also called the book of original entry.
Plant Assets
Deficit
Journal
Accrual Basis Accounting
34. Business owned by two or more people.
Ledger
Stockholders
Partnership Agreement
Partnership
35. Journal entries that affect at least three accounts.
Matching Principle
Credit
Compound Journal Entries
Fixed Expense
36. Prescribes expenses to be reported in the same period as the revenues that were eared as a result of the expenses. Also called the Expense Recognition Principle.
Corporations
Owner - Capital
Balance Sheet
Matching Principle
37. Assets put into the business by the owner.
Net Loss
Adjusting Entry
Matching Principle
Owner Investment
38. 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.
Intangible assets
Financial Accounting Standards Board
International Financial Reporting Standards
IPO
39. Ratio used to evaluate a company's ability to pay its short term obligations - calculated by dividing current assets by current liabilities.
Ethics
Sole Propietorship
Current Ratio
Statement of Cash Flows
40. Balance sheet that presents assets and liabilities in relevant subgroups - including current and non-current classifications.
Classified Balance Sheet
Time Period Assumptions
Going-concern Assumptions
Debit
41. Liability created when customers pay in advance for products or services; earned when the products or services are later delivered.
Generally Accepted Accounting Principles
Unearned Revenue
Managerial Accounting
Partnership
42. Activities within an organization that can affect the accounting equation.
Profit Margin
Internal transactions
Accrual Basis Accounting
Equity
43. 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).
Journal
Common Stock
Income Summary
Financial Accounting
44. Happenings that both affect an organization's financial position and can be reliably measured.
Matching Principle (or Expense Recognition Principle)
Annual Financial Statements
Events
Internal transactions
45. The part of accounting that involves recording transactions and events either manually or electronically. Also called Recordkeeping.
International Accounting Standards Board
Bookkeeping
SMART Goal
Income Statement
46. Financial statements covering periods of less than one year; usually based on one- - three- - or six-month periods.
Interim Financial Statements
Statement of Owner's Equity
Credit
Corporations
47. Resources that a company owns or controls that are expected to provide current and future benefits to the business.
Current Liabilities
Unclassified Balance Sheets
Assets
Generally Accepted Accounting Principles
48. Individuals or organizations that owe money.
Financial Accounting Standards Board
Audit
CD (Certificate of Deposit)
Debtors
49. Ratio of a company's net income to its net sales. The percent of income in each dollar of revenue.
Accounting Cycle
Balance Column Account
Owner Withdrawals
Profit Margin
50. Equality involving a company's assets - liabilities - and equity; Assets = Liabilities + Equity
Expanded Accounting Equation
Mergers
Federal Reserve System
Accounting Equation