What does GAAP stand for?

Generally Accepted Accounting Principles

Plan for future income and expenses

Record of financial transactions

What is a financial ratio?

Comparison of financial metrics

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Financial Literacy Quiz

20 termsStudBud Administration4 plays

Test your knowledge on accounting principles, financial statements, and key concepts in the world of finance.

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Questions 20

Answers

1
What is an asset?
Debt owed to creditors
Resource owned by a company
Expense incurred in operations
Income generated from sales
2
What does GAAP stand for?
Generally Accepted Accounting Principles
Global Accounting and Auditing Practices
General Accounting and Analysis Procedures
Government Accounting and Auditing Policies
3
What is the purpose of an audit?
Increase company profits
Create financial statements
Reduce tax liabilities
Verify financial accuracy
4
What is a budget?
Summary of assets only
Record of past transactions
List of liabilities only
Plan for future income and expenses
5
What is a trial balance?
Summary of cash flow
Statement of equity
List of account balances
Report of financial ratios
6
What is a fiscal year?
Monthly financial cycle
Calendar year only
Quarterly reporting period
12-month accounting period
7
What is accrual accounting?
Record based on estimates
Record when earned or incurred
Record at year-end only
Record only cash transactions
8
True or false: Equity represents ownership in a company.
True
False
9
What is a ledger?
List of liabilities
Tax filing document
Summary of profits
Record of financial transactions
10
What does ROI stand for?
Return on Interest
Revenue on Investment
Rate of Income
Return on Investment
11
Which financial statement shows profit?
Income Statement
Cash Flow Statement
Equity Statement
Balance Sheet
12
What is depreciation?
Inventory valuation method
Asset value reduction
Cash flow management
Increase in asset value
13
What is a balance sheet?
Cash flow analysis
Detailed income report
Expense tracking document
Snapshot of financial position
14
What is a journal entry?
Record of transactions
Summary of accounts
Financial statement report
Tax calculation document
15
What is the accounting equation?
Assets = Liabilities + Equity
Assets + Liabilities = Equity
Equity = Assets - Liabilities
Liabilities = Assets + Equity
16
What is the purpose of a cash flow statement?
List assets and liabilities
Show profit margins
Track cash movements
Calculate tax obligations
17
What is a financial ratio?
List of expenses
Summary of assets
Total revenue calculation
Comparison of financial metrics
18
Which is an example of an expense?
Investments
Equipment
Rent
Inventory
19
Which is a liability?
Equity
Accounts Payable
Inventory
Cash
20
Which is a current asset?
Land
Inventory
Buildings
Patents

Financial Literacy Quiz Flashcards | StudBud