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






2. Firm's ability to satisfy short term debt






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






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






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






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






7. A legal value assigned to each share of stock






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






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






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






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






12. Cash - Accounts Recievable - Inventory






13. Retained earnings + Net Income - (Dividends)






14. Cost allocated to each year of the assets life






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






16. Costs incurred to produce revenues






17. Extra value that is recorded when buying another company






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






19. All assets not listed as current






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






21. Relate to how a company finances its assets with debt or stockholders' equity






22. Revenues-Expenses






23. Smaller proportional increases in the number of shares outstanding






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






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






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






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






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






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






30. Expresses each income statement item as a percentage of sales






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






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






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






34. Due after 12 months






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






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






37. Defines ethical behavior code of professional conduct






38. Firm's ability to satisfy long term debt






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






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






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






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






43. Records transactions when cash is recieved or paid






44. Merchandise held for sale to customers






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






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






47. Refer to revenues from the sale of merchandise






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






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






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