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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. A company's ability to pay liabilities as they come due in the next year






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






3. 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






4. Defines ethical behavior code of professional conduct






5. Net Income/Sales Revenue measures the profitability of each dollar of revenue






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






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






8. Refer to revenues from the sale of merchandise






9. Firm's ability to satisfy long term debt






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






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






12. Highly unusual transactions that are considered unusual in nature and infrequent in occurence






13. Due after 12 months






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






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






16. Sales revenue/ total assets measures how efficiently the company uses assets to generate revenue






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






18. Are liabilities due within 12 months






19. 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






20. Revenues are recorded in the period earned - not necessarily in the period that the company collects the money






21. Shares are bought and sold on stock exchanges such as the New york stock exchange






22. A legal value assigned to each share of stock






23. Annual common stock dividends paid/average number of common shares outstanding - amount of dividends paid annually for each share of stock held by investors






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






25. Amounts that the corporation must pay to suppliers in the future






26. Borrowing corporation records bonds payable






27. Extra value that is recorded when buying another company






28. legislative authority to set the reporting rules for accounting info of publicly held corporations






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






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






31. All assets not listed as current






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






33. Smaller proportional increases in the number of shares outstanding






34. Equals the difference between revenues and cost of sales






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






36. Revenues-Expenses






37. A company's ability to pay liabilities for many years into the future






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






39. Proportional increases in the number of shares outstanding






40. Entity loaning the money records a bond recievable






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






42. States that companies should record assets and services at their acquisition cost - the amount paid for them - because this is the most reliable information






43. Largest expense item which reports the wholesale costs of inventory sold during the accounting period






44. Standardizes each item as based on a base year and reports data for subsequent years as a multiple of the standard






45. Idea that accountants usually record transactions when they occur - not necessarily when cash is recieved or paid






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






47. Contracts that give their holders the right to buy or sell shares of stock at a certain market price






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






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






50. Licensed by the state/conduct audits






Can you answer 50 questions in 15 minutes?



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