SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
Search
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. 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
Horizontal common size statement
Sales
Statement of Stockholders equity
Asset
2. 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
Common size income statement
Stock splits
Television costs
Financial Leverage
3. legislative authority to set the reporting rules for accounting info of publicly held corporations
FASB
SEC
Cost of Goods Sold
Goodwill
4. Actual currency - bank accounts - and investments that can be liquidated immediately
Cash and Cash equivalents
Debt Ratio
Times Interest Earned Ration
Revenues
5. Firm's ability to satisfy short term debt
Stock options
Liquidity ratios
Revenues
Cost of Goods Sold(COGS)
6. Compares all amounts within on year to total assets of that same year
Preferred stock
Operating Expenses
Common-size balance sheet
Dividend rate
7. Establish auditing standards and conduct inspections of the public accounting firm that perform audits
Cash- Basis Accounting
AICPAs
PCAOB
FASB
8. Idea that accountants usually record transactions when they occur - not necessarily when cash is recieved or paid
Accrual Accounting
Expenses
Return on Sales
Recievables
9. Total liabilities/ Total assets reveals the proportion of assets financed with debt and solvency
Financial Leverage
Shares Outstanding
Discontinued Operations
Debt Ratio
10. Contracts that give their holders the right to buy or sell shares of stock at a certain market price
Retained Earnings
AICPAs
Goodwill
Stock options
11. Net Income-Preferred dividends/Average number of common shares outstanding - Amount of net income earned by each individual share of stock held by investors
Solvency ratios
Publicly traded
Earnings per share
Debtor
12. Cost of television programs that will be aired during the next year
Television costs
Noncurrent liabilities
Return on Sales
Par value
13. Are liabilities due within 12 months
Par value
Revenue Recognition Principle
Current liabilites
Basic earnings per share
14. Sales revenue/ total assets measures how efficiently the company uses assets to generate revenue
Noncurrent liabilities
Retained Earnings
Operating Income
Asset Turnover
15. Stock bought back from investors not recorded as an asset because it is impossible for a company to own itself
Treasury stock
Solvency
Operating activities
Horizontal common size statement
16. Shares are bought and sold on stock exchanges such as the New york stock exchange
Financial Leverage
Statement of cash flows
Solvency
Publicly traded
17. Items of value such as inventory and equipment are financed with liabilities(debt) or stockholders' equity(owners' shares
SEC
Recievables
Times Interest Earned Ration
Asset
18. Provides a snapshot of a company's financial position as of a certain date
Debt Ratio
Revenues
Balance Sheet
Accrual Accounting
19. Reports cash inflows + cash outflows during an accounting period
Stockholders' Equity
Debtor
FASB
Statement of cash flows
20. Amounts to be recieved in the future from customers
Creditor
Inventories
Accounts recievable
Preferred stock
21. Rules that management must follow when preparing financial statements available to investors
Asset Turnover
Stock options
Income Statement
GAAP
22. Highly unusual transactions that are considered unusual in nature and infrequent in occurence
Shares Outstanding
Extraordinary items
Income Statement
CPAS
23. Relate to how a company finances its assets with debt or stockholders' equity
Financing activities
Expenses
Retained Earnings
Accounts Payable
24. Current amount/base year amount x 100 measures the percentage of change from the base year and indicates growth trends for a company
Accounting Equation
Trend index
Statement of Stockholders equity
Asset Turnover
25. Includes all costs of generating sales besides cost of sales
Operating Expenses
Noncurrent liabilities
Treasury stock
Investing activities
26. Borrowing corporation records bonds payable
Horizontal common size statement
Debtor
Price earnings ratio
Audits
27. Largest expense item which reports the wholesale costs of inventory sold during the accounting period
Cost of Goods Sold
Solvency ratios
Cost of Goods Sold(COGS)
Nonrecurring items
28. Amounts recieved from customers for products sold or services provided
Accrual Accounting
Expenses
Revenues
Liquidity ratios
29. Refer to revenues from the sale of merchandise
Publicly traded
GAAP
Treasury stock
Sales
30. Net income earned by the company since its incorporation and not yet distributed as dividends
Asset Turnover
Retained Earnings
Debt Ratio
Liquidity
31. Reports the company's profitability during an accounting period
Asset Turnover
Income Statement
Accrual Accounting
Times Interest Earned Ration
32. Relate to the need for investing in property - plant - and equipment or expanding by making investments in other companies
Investing activities
Return on Sales
Stockholders' Equity
Stock splits
33. Attest to whether a company's financial statements comply with the GAAP rules
Cost of Goods Sold(COGS)
PCAOB
Audits
Accumulated Depreciation
34. Expresses each balance sheet item as a percentage of total assets
Vertical common size balance sheet
Goodwill
Gains and Losses
Nonrecurring items
35. Merchandise held for sale to customers
Inventories
Gross Profit Margin
Audits
Balance Sheet
36. Licensed by the state/conduct audits
Accumulated other comprehensive income
Solvency
CPAS
GAAP
37. Proportional increases in the number of shares outstanding
Market value per share
Initial Public Offering (IPO)
Stock splits
Financial Leverage
38. Expected to be converted into cash - sold - or consumed within the next 12 months
Current assets
Gains and Losses
Times Interest Earned Ration
Balance Sheet
39. Assets=
40. Amounts paid by stockholders to purchase common stock and preferred stock
Current liabilites
Contributed Capital
Treasury stock
Financing activities
41. Most accounting reporting standards that formulate GAAP are set by the 7 full time voting members
Accumulated Depreciation
Revenue Recognition Principle
Stock splits
FASB
42. A company's ability to pay liabilities for many years into the future
Gross Profit
Cost of Goods Sold
Solvency ratios
Solvency
43. Accountants deem unusual and infrequent - may appear in the bottom section of the income statement
Nonrecurring items
Depreciation Expense
Trend index
Contributed capital (ending)
44. Gross profit/Sales revenue - compares gross profit to revenue expressing gross profit as a percentage of net revenue
Contributed capital (ending)
Expenses
Gross Profit Margin
Operating activities
45. Relate to a company's main business: selling products or services to earn net income
Debt Ratio
liabilities + stockholders' equity
Revenue Recognition Principle
Operating activities
46. Equals the difference between revenues and cost of sales
Price earnings ratio
Operating Expenses
Gross Profit
Stockholders' Equity
47. Amounts that the corporation must pay to suppliers in the future
PCAOB
Accounting Equation
Accounts Payable
CPAS
48. Stock market trading price of the company's common stock
Gross Profit
Return on Asset
Revenue Recognition Principle
Market value per share
49. Operating Income/Interest Expense - compares the amount of income available to make interest payments to interest payment requirements
Basic earnings per share
Stock options
Market value per share
Times Interest Earned Ration
50. Net Income/Sales Revenue measures the profitability of each dollar of revenue
Return on Sales
Common-size balance sheet
Contributed capital (ending)
Intangible assets