Test your basic knowledge |

Financial Statements

Subject : 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. Total amount of depreciation expensed since the assets' date of purchase






2. Reports cash inflows + cash outflows during an accounting period






3. Accountants deem unusual and infrequent - may appear in the bottom section of the income statement






4. Cost allocated to each year of the assets life






5. Items of value such as inventory and equipment are financed with liabilities(debt) or stockholders' equity(owners' shares






6. Expected to be converted into cash - sold - or consumed within the next 12 months






7. Stock bought back from investors not recorded as an asset because it is impossible for a company to own itself






8. Amounts paid by stockholders to purchase common stock and preferred stock






9. Cost of television programs that will be aired during the next year






10. Market price per share/EPS - to measure how expensive a company's stock is compared to EPS






11. Entity loaning the money records a bond recievable






12. Defines ethical behavior code of professional conduct






13. Contributed capital - beginning + issuance of shares - (Repurchase to retire shares)






14. Companies divide net income by the actual average number of common shares outstanding






15. Firm's ability to satisfy short term debt






16. Indicate that returns or discounts were subtracted from total sales






17. Costs incurred to produce revenues






18. Subtracting operating expenses from gross profit (Income from Operations)






19. Retained earnings + Net Income - (Dividends)






20. Stock market trading price of the company's common stock






21. Net income earned by the company since its incorporation and not yet distributed as dividends






22. Relate to the need for investing in property - plant - and equipment or expanding by making investments in other companies






23. Net Income/ Stockholders Equity - measures how effectively stockholders' equity is used to produce net income






24. Net Income-Preferred Dividends/Common Stockholders equity - To analyze stock performance






25. Equals the difference between revenues and cost of sales






26. Firm's ability to satisfy long term debt






27. Compares all amounts within on year to total assets of that same year






28. Records transactions when cash is recieved or paid






29. Net Income-Preferred dividends/Average number of common shares outstanding - Amount of net income earned by each individual share of stock held by investors






30. Total liabilities/ Total assets reveals the proportion of assets financed with debt and solvency






31. The total number of shares actually held by investors at a given time - =Shares issued-treasury shares






32. Attest to whether a company's financial statements comply with the GAAP rules






33. Expresses each balance sheet item as a percentage of total assets






34. Gross profit/Sales revenue - compares gross profit to revenue expressing gross profit as a percentage of net revenue






35. Includes all costs of generating sales besides cost of sales






36. Rules that management must follow when preparing financial statements available to investors






37. Measures how efficiently you can generate desired outputs from given inputs






38. Cost of bringing in revenues






39. Relate to how a company finances its assets with debt or stockholders' equity






40. Amounts recieved from customers for products sold or services provided






41. Provides a snapshot of a company's financial position as of a certain date






42. Revenues-Expenses






43. Total assets/Stockholders equity - Explains the difference between return on assets and return on equity. A high debt ratio and the high financial risk can boost profits






44. Recorded in stockholders equity 1. unrealized gains/losses on certain securities 2. Foreign currency translation adjustments 3. Certain gains/losses on pension plans






45. A legal value assigned to each share of stock






46. Relate to a company's main business: selling products or services to earn net income






47. Actual currency - bank accounts - and investments that can be liquidated immediately






48. Are liabilities due within 12 months






49. Entities owning shares of stock are the owners of the corporation






50. This is what it costs to produce a product or provide a service