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






2. Cash - Accounts Recievable - Inventory






3. Operating Income/Interest Expense - compares the amount of income available to make interest payments to interest payment requirements






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






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






6. Borrowing corporation records bonds payable






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






8. Establish auditing standards and conduct inspections of the public accounting firm that perform audits






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






10. Monies to be recieved by the company from customers






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






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






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






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






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






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






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






18. Most accounting reporting standards that formulate GAAP are set by the 7 full time voting members






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






20. Firm's ability to satisfy short term debt






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






22. Merchandise held for sale to customers






23. Firm's ability to satisfy long term debt






24. Refer to revenues from the sale of merchandise






25. Amounts to be recieved in the future from customers






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






27. Licensed by the state/conduct audits






28. Records transactions when cash is recieved or paid






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






30. Assets=

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






32. All assets not listed as current






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






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






35. Revenues-Expenses






36. 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






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






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






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






40. Equals the difference between revenues and cost of sales






41. Cost allocated to each year of the assets life






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






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






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






45. Costs incurred to produce revenues






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






47. Assets- Liabilitie+ Equity OR Assets Liabilities- assets






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






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






50. Entity loaning the money records a bond recievable