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Test your basic knowledge |
Financial Statements
Start Test
Study First
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. Smaller proportional increases in the number of shares outstanding
Horizontal common size statement
Stock dividends
Goodwill
Vertical common size balance sheet
2. Reports the company's profitability during an accounting period
Common-size balance sheet
Accumulated Depreciation
Income Statement
Balance Sheet
3. Gross profit/Sales revenue - compares gross profit to revenue expressing gross profit as a percentage of net revenue
Initial Public Offering (IPO)
Basic earnings per share
Revenue Recognition Principle
Gross Profit Margin
4. Recorded in stockholders equity 1. unrealized gains/losses on certain securities 2. Foreign currency translation adjustments 3. Certain gains/losses on pension plans
Solvency
Inventories
Initial Public Offering (IPO)
Accumulated other comprehensive income
5. Net Income/Sales Revenue measures the profitability of each dollar of revenue
Stock dividends
Return on Sales
Statement of cash flows
Operating Expenses
6. Expresses each income statement item as a percentage of sales
Accrual Accounting
Vertical common size income statement
GAAP
PCAOB
7. Companies divide net income by the actual average number of common shares outstanding
Dividend rate
Earnings per share
Return on Equity
Basic earnings per share
8. Compares all amounts within one year to revenue of that same year
Debtor
Expenses
Stockholders
Common size income statement
9. Annual common stock dividends paid/average number of common shares outstanding - amount of dividends paid annually for each share of stock held by investors
Financial Leverage
Market value per share
Dividend rate
Audits
10. Due after 12 months
Noncurrent liabilities
Current ratio
Accumulated other comprehensive income
Accounting Equation
11. The total number of shares actually held by investors at a given time - =Shares issued-treasury shares
Shares Outstanding
Goodwill
Common size income statement
Sales
12. Measures how efficiently you can generate desired outputs from given inputs
Accumulated other comprehensive income
Solvency ratios
Productivity
Shares Outstanding
13. A legal value assigned to each share of stock
CPAS
Trend index
Nonrecurring items
Par value
14. Refer to revenues from the sale of merchandise
Sales
Example of Current Asset
Accounting Equation
Treasury stock
15. Provides a snapshot of a company's financial position as of a certain date
Balance Sheet
Preferred stock
Market value per share
Vertical common size balance sheet
16. Accountants deem unusual and infrequent - may appear in the bottom section of the income statement
Nonrecurring items
AICPAs
Common size income statement
Dividend rate
17. Costs incurred to produce revenues
Gains and Losses
Expenses
Goodwill
Extraordinary items
18. Highly unusual transactions that are considered unusual in nature and infrequent in occurence
CPAS
Television costs
Extraordinary items
Noncurrent assets
19. Firm's ability to satisfy short term debt
Gains and Losses
Investing activities
Liquidity ratios
Liquidity
20. Merchandise held for sale to customers
Accounting Equation
Price earnings ratio
Inventories
Shares Outstanding
21. Establish auditing standards and conduct inspections of the public accounting firm that perform audits
PCAOB
Retained earnings(ending)
Solvency
Liquidity
22. Current amount/base year amount x 100 measures the percentage of change from the base year and indicates growth trends for a company
Dividend rate
Trend index
Times Interest Earned Ration
CPAS
23. Assets- Liabilitie+ Equity OR Assets Liabilities- assets
Debt Ratio
Accounting Equation
Vertical common size balance sheet
Expenses
24. Firm's ability to satisfy long term debt
Solvency ratios
Statement of Stockholders equity
Current assets
PCAOB
25. Most accounting reporting standards that formulate GAAP are set by the 7 full time voting members
FASB
Audits
SEC
Liquidity
26. Cash - Accounts Recievable - Inventory
Nonrecurring items
Statement of Stockholders equity
Example of Current Asset
Stockholders' Equity
27. Reports if the earnings of this accounting period are distributed as dividends or retained in the business as retained earnings. Also reports amounts paid by stockholders to purchase common stock and preferred stock
Retained earnings(ending)
Statement of Stockholders equity
Current assets
Cost of Goods Sold(COGS)
28. Standardizes each item as based on a base year and reports data for subsequent years as a multiple of the standard
Horizontal common size statement
Current liabilites
Common size income statement
Expenses
29. Revenues are recorded in the period earned - not necessarily in the period that the company collects the money
Gains and Losses
Historical cost principle
Revenue Recognition Principle
Audits
30. Carries a dividend rate which must be paid to preferred stockholders before any dividends can be paid to common stockholders
Gross Profit Margin
Trend index
Accumulated Depreciation
Preferred stock
31. Cost of television programs that will be aired during the next year
Extraordinary items
Television costs
Contributed Capital
Current ratio
32. legislative authority to set the reporting rules for accounting info of publicly held corporations
SEC
Solvency
Accounts recievable
Earnings per share
33. Are liabilities due within 12 months
Current liabilites
Vertical common size income statement
Nonrecurring items
Audits
34. Rules that management must follow when preparing financial statements available to investors
GAAP
Creditor
Revenue Recognition Principle
Return on Equity
35. Relate to a company's main business: selling products or services to earn net income
Operating activities
Return on Equity
Recievables
Stockholders' Equity
36. Attest to whether a company's financial statements comply with the GAAP rules
PCAOB
Audits
Net Sales
Creditor
37. Expresses each balance sheet item as a percentage of total assets
Operating activities
Vertical common size balance sheet
Par value
Productivity
38. Reports cash inflows + cash outflows during an accounting period
Cash and Cash equivalents
Statement of cash flows
Earnings per share
Return on Sales
39. This is what it costs to produce a product or provide a service
Cost of Goods Sold(COGS)
Horizontal common size statement
Current assets
Stock options
40. Largest expense item which reports the wholesale costs of inventory sold during the accounting period
Debt Ratio
GAAP
Gains and Losses
Cost of Goods Sold
41. Portion of assets the owners are free and clear of any liabilities
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42. Borrowing corporation records bonds payable
Debtor
Accounts Payable
Example of Current Asset
Cash and Cash equivalents
43. A company's ability to pay liabilities for many years into the future
Gains and Losses
Solvency
Vertical common size income statement
Liquidity
44. Patents - trademarks - and copyrights that have value but not any physical presence
Revenue Recognition Principle
Return on Common Equity
Intangible assets
Cost of Goods Sold(COGS)
45. Proportional increases in the number of shares outstanding
Example of Current Asset
Statement of cash flows
Stock splits
Cost of Goods Sold
46. Entity loaning the money records a bond recievable
Creditor
Return on Common Equity
Nonrecurring items
Solvency ratios
47. When a company sells stock to the public for the first time as a publicly traded corporation
Debtor
SEC
Initial Public Offering (IPO)
Retained Earnings
48. Amounts recieved from customers for products sold or services provided
Publicly traded
Income Statement
Expenses
Revenues
49. Stock bought back from investors not recorded as an asset because it is impossible for a company to own itself
Net Income
Nonrecurring items
Debt Ratio
Treasury stock
50. All assets not listed as current
PCAOB
Return on Sales
Noncurrent assets
Gross Profit Margin