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






2. 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






3. Cost allocated to each year of the assets life






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






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






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






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






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






9. 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






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






11. Assets=


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






13. Due after 12 months






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






15. Records transactions when cash is recieved or paid






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






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






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






19. Revenues-Expenses






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






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






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






23. All assets not listed as current






24. Retained earnings + Net Income - (Dividends)






25. Refer to revenues from the sale of merchandise






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






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


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






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






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






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






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






33. Licensed by the state/conduct audits






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






35. Relate to a company's main business: selling products or services to earn net income






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






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






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






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






40. Firm's ability to satisfy short term debt






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






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






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






44. Entity loaning the money records a bond recievable






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






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






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






48. Cash - Accounts Recievable - Inventory






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






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