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






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






3. Entity loaning the money records a bond recievable






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






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






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






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






8. Cost allocated to each year of the assets life






9. Borrowing corporation records bonds payable






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






11. Net Income/ total assets reveals how efficiently assets are used to generate profit






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






13. Expresses each income statement item as a percentage of sales






14. Smaller proportional increases in the number of shares outstanding






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






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






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






18. Recorded when a company closes down or sells part of its business






19. Current amount/base year amount x 100 measures the percentage of change from the base year and indicates growth trends for a company






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






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






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






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






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






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






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






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






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






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






30. When a company sells stock to the public for the first time as a publicly traded corporation






31. Current assets/current liabilites - measure short term liquidity and the ability to pay current liabilities as they come due






32. Revenues-Expenses






33. Carries a dividend rate which must be paid to preferred stockholders before any dividends can be paid to common stockholders






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






35. Reports the company's profitability during an accounting period






36. Are liabilities due within 12 months






37. Cash - Accounts Recievable - Inventory






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






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






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






41. All assets not listed as current






42. Due after 12 months






43. Records transactions when cash is recieved or paid






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






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






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






47. Portion of assets the owners are free and clear of any liabilities


48. Compares all amounts within one year to revenue of that same year






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






50. A legal value assigned to each share of stock