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






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






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






4. Defines ethical behavior code of professional conduct






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






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






7. Due after 12 months






8. Borrowing corporation records bonds payable






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






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






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






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






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






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






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






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






17. Cash - Accounts Recievable - Inventory






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

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19. 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






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






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






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






23. Cost of bringing in revenues






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






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






26. Records transactions when cash is recieved or paid






27. Refer to revenues from the sale of merchandise






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






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






30. Amounts to be recieved in the future from customers






31. Equals the difference between revenues and cost of sales






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






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






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






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






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






37. All assets not listed as current






38. Assets=

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39. Smaller proportional increases in the number of shares outstanding






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






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






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






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






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






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






46. Merchandise held for sale to customers






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






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






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






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