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






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






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






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






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

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






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






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






9. Smaller proportional increases in the number of shares outstanding






10. 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






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






12. Defines ethical behavior code of professional conduct






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






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






15. Costs incurred to produce revenues






16. A legal value assigned to each share of stock






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






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






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






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






21. Amounts to be recieved in the future from customers






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






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






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






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






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






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






28. Firm's ability to satisfy short term debt






29. Records transactions when cash is recieved or paid






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






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






32. Retained earnings + Net Income - (Dividends)






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






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






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






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






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






38. Stock market trading price of the company's common stock






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






40. Monies to be recieved by the company from customers






41. Entities owning shares of stock are the owners of the corporation






42. Extra value that is recorded when buying another company






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






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






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






46. Licensed by the state/conduct audits






47. Firm's ability to satisfy long term debt






48. Rules that management must follow when preparing financial statements available to investors






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






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