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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. Licensed by the state/conduct audits






2. Cost of bringing in revenues






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






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






5. Extra value that is recorded when buying another company






6. Entity loaning the money records a bond recievable






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






8. Records transactions when cash is recieved or paid






9. Largest expense item which reports the wholesale costs of inventory sold during the accounting period






10. Monies to be recieved by the company from customers






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






12. Smaller proportional increases in the number of shares outstanding






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






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






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






16. Amounts to be recieved in the future from customers






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






18. Equals the difference between revenues and cost of sales






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






20. Firm's ability to satisfy short term debt






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






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






23. 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






24. Costs incurred to produce revenues






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






26. Assets=

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






28. Merchandise held for sale to customers






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






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






31. 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






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






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






34. Refer to revenues from the sale of merchandise






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






36. Amounts paid by stockholders to purchase common stock and preferred stock






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






38. Proportional increases in the number of shares outstanding






39. Retained earnings + Net Income - (Dividends)






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

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






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






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






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






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






46. A legal value assigned to each share of stock






47. Are liabilities due within 12 months






48. Standardizes each item as based on a base year and reports data for subsequent years as a multiple of the standard






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






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







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