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. Refer to revenues from the sale of merchandise






2. Costs incurred to produce revenues






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






4. Recorded in stockholders equity 1. unrealized gains/losses on certain securities 2. Foreign currency translation adjustments 3. Certain gains/losses on pension plans






5. Assets=


6. Records transactions when cash is recieved or paid






7. Extra value that is recorded when buying another company






8. Firm's ability to satisfy long term debt






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






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






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






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






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






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






15. 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






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






17. Patents - trademarks - and copyrights that have value but not any physical presence






18. 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






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






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






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






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






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






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






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






26. Amounts to be recieved in the future from customers






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


28. Rules that management must follow when preparing financial statements available to investors






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






30. Entity loaning the money records a bond recievable






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






32. All assets not listed as current






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






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






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






36. Proportional increases in the number of shares outstanding






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






38. Equals the difference between revenues and cost of sales






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






40. Revenues-Expenses






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






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






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






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






45. Arise from the sale of long-lived assets or investments






46. Defines ethical behavior code of professional conduct






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






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






49. Due after 12 months






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