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Test your basic knowledge |
Financial Statements
Start Test
Study First
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. Smaller proportional increases in the number of shares outstanding
Earnings per share
Stock dividends
Treasury stock
Accounts Payable
2. Merchandise held for sale to customers
Creditor
Inventories
Contributed Capital
Earnings per share
3. legislative authority to set the reporting rules for accounting info of publicly held corporations
Contributed capital (ending)
SEC
Shares Outstanding
Television costs
4. Current assets/current liabilites - measure short term liquidity and the ability to pay current liabilities as they come due
Sales
Current ratio
Depreciation Expense
Contributed capital (ending)
5. Retained earnings + Net Income - (Dividends)
Noncurrent liabilities
Retained earnings(ending)
Current liabilites
Operating Expenses
6. Relate to how a company finances its assets with debt or stockholders' equity
Financing activities
Stock dividends
Asset Turnover
Return on Common Equity
7. Total amount of depreciation expensed since the assets' date of purchase
FASB
Current liabilites
Accumulated Depreciation
Expenses
8. Reports the company's profitability during an accounting period
Income Statement
Return on Asset
Operating activities
FASB
9. Portion of assets the owners are free and clear of any liabilities
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10. Cost of bringing in revenues
Contributed capital (ending)
Solvency
Expenses
Return on Asset
11. Amounts paid by stockholders to purchase common stock and preferred stock
Expenses
Contributed Capital
Net Income
Statement of Stockholders equity
12. Firm's ability to satisfy short term debt
Liquidity ratios
Operating activities
Extraordinary items
Cost of Goods Sold(COGS)
13. Entity loaning the money records a bond recievable
Preferred stock
Revenues
Creditor
Dividend rate
14. Total liabilities/ Total assets reveals the proportion of assets financed with debt and solvency
Revenues
Noncurrent assets
Debt Ratio
Operating Income
15. Recorded when a company closes down or sells part of its business
Contributed capital (ending)
Noncurrent assets
Solvency
Discontinued Operations
16. Stock market trading price of the company's common stock
Depreciation Expense
Accrual Accounting
Solvency ratios
Market value per share
17. Companies divide net income by the actual average number of common shares outstanding
Net Sales
Basic earnings per share
Debtor
Cash- Basis Accounting
18. Defines ethical behavior code of professional conduct
Revenues
AICPAs
liabilities + stockholders' equity
Stock dividends
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
Retained earnings(ending)
Statement of Stockholders equity
Intangible assets
Return on Sales
20. The total number of shares actually held by investors at a given time - =Shares issued-treasury shares
Operating activities
Sales
Shares Outstanding
Solvency
21. A legal value assigned to each share of stock
Debtor
Operating Expenses
Discontinued Operations
Par value
22. Net income earned by the company since its incorporation and not yet distributed as dividends
Recievables
SEC
Retained Earnings
Return on Equity
23. Cash - Accounts Recievable - Inventory
Example of Current Asset
Nonrecurring items
Television costs
Net Sales
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
Operating activities
Retained Earnings
FASB
Historical cost principle
25. Net Income/Sales Revenue measures the profitability of each dollar of revenue
Liquidity
Return on Sales
Treasury stock
Cash and Cash equivalents
26. Revenues-Expenses
Net Income
Times Interest Earned Ration
Net Sales
Treasury stock
27. Standardizes each item as based on a base year and reports data for subsequent years as a multiple of the standard
Contributed capital (ending)
Horizontal common size statement
Extraordinary items
Example of Current Asset
28. Establish auditing standards and conduct inspections of the public accounting firm that perform audits
Retained Earnings
Contributed Capital
PCAOB
Gains and Losses
29. A company's ability to pay liabilities as they come due in the next year
Publicly traded
Statement of Stockholders equity
Revenue Recognition Principle
Liquidity
30. Expresses each balance sheet item as a percentage of total assets
Dividend rate
Return on Sales
Vertical common size balance sheet
Stockholders
31. Provides a snapshot of a company's financial position as of a certain date
Cost of Goods Sold(COGS)
Balance Sheet
Par value
Cash- Basis Accounting
32. Cost allocated to each year of the assets life
Depreciation Expense
Contributed capital (ending)
Noncurrent assets
Operating Expenses
33. Due after 12 months
Creditor
Return on Asset
Income Statement
Noncurrent liabilities
34. Contracts that give their holders the right to buy or sell shares of stock at a certain market price
GAAP
Audits
Stock options
Liquidity
35. A company's ability to pay liabilities for many years into the future
Trend index
Current assets
Solvency
Return on Common Equity
36. Subtracting operating expenses from gross profit (Income from Operations)
Vertical common size balance sheet
Balance Sheet
Operating Income
Television costs
37. Annual common stock dividends paid/average number of common shares outstanding - amount of dividends paid annually for each share of stock held by investors
Accounts Payable
Dividend rate
Debtor
Times Interest Earned Ration
38. Borrowing corporation records bonds payable
Debtor
Initial Public Offering (IPO)
Financing activities
Return on Asset
39. Includes all costs of generating sales besides cost of sales
Shares Outstanding
AICPAs
Operating Expenses
Revenues
40. 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
Financial Leverage
Goodwill
Retained Earnings
Debtor
41. Compares all amounts within on year to total assets of that same year
Return on Asset
Stockholders
Sales
Common-size balance sheet
42. Idea that accountants usually record transactions when they occur - not necessarily when cash is recieved or paid
Discontinued Operations
Accounting Equation
Statement of Stockholders equity
Accrual Accounting
43. Assets- Liabilitie+ Equity OR Assets Liabilities- assets
Intangible assets
Contributed capital (ending)
FASB
Accounting Equation
44. Operating Income/Interest Expense - compares the amount of income available to make interest payments to interest payment requirements
Historical cost principle
Common size income statement
Cash and Cash equivalents
Times Interest Earned Ration
45. Costs incurred to produce revenues
Expenses
Gains and Losses
Stock dividends
Shares Outstanding
46. Monies to be recieved by the company from customers
Recievables
Current ratio
liabilities + stockholders' equity
PCAOB
47. Patents - trademarks - and copyrights that have value but not any physical presence
Intangible assets
Initial Public Offering (IPO)
Goodwill
Times Interest Earned Ration
48. Expresses each income statement item as a percentage of sales
PCAOB
Vertical common size income statement
Return on Asset
Creditor
49. Entities owning shares of stock are the owners of the corporation
Nonrecurring items
Stockholders
Solvency
CPAS
50. Carries a dividend rate which must be paid to preferred stockholders before any dividends can be paid to common stockholders
CPAS
Contributed capital (ending)
Preferred stock
Liquidity ratios