Financial Knowing

Question 1

Owners claim on the practices assets

Answer 1

Equity

Question 2

A fund or cash reserve that is maintained at a constant level for lengthy periods of time

Answer 2

Impress account

Question 3

A gain or recurrent benefit usually measured In money

Answer 3

Income

Question 4

Also known as the profit and loss statement a report on financial performance that covers a period of time and reports income and expenses during that period

Answer 4

Income statement

Question 5

Expenses that have to be paid by a company independent of any business activity

Answer 5

Fixed costs

Question 6

A cost that does not change with an increase or decrease in the amount of goods or services produced

Answer 6

Fixed expense/ cost

Question 7

Cost that may be manipulated in amount or eliminated by not engaging In the activity that incurred expense

Answer 7

Flexible / variable expenses

Question 8

Tax levied by a government directly on income, especially an annual tax on personal income

Answer 8

Income tax

Question 9

Formed into legal corporations

Answer 9

Incorporated

Question 10

The percentage rate at which the general level of prices for goods and services is rising, and subsequently purchasing power is falling

Answer 10

Inflation rate

Question 11

Measured outflow of services and goods matched to the revenue generated for the outflow

Answer 11

Expenses

Question 12

Ratios used to analyze how well a company uses its assets and liabilities internally

Answer 12

Efficiency ratios for accounts payable to sales

Question 13

The most economical quantity of a product to order, factoring in both holding and operating costs

Answer 13

Economic order quantity EOQ

Question 14

The identification, assessment, and prioritization of financial risks followed by coordination and economical application of resources to minimize, monitor, and control the probability of said risk

Answer 14

Economic risk management

Question 15

A sum of money placed or kept in a bank account usually to gain interest

Answer 15

Deposits

Question 16

Systemic allocation of the cost of a tangible asset over time

Answer 16

Depreciation

Question 17

The process of allocating the cost of an asset across the time period for which it provides benefit (known as the assets depreciable or useful life)

Answer 17

Depreciation

Question 18

A figure on the income statement that reflects the cost of products sold to consumers in the primary business activity of the practice

Answer 18

Cost of goods sold COGS

Question 19

Theoretical price that measures relative cost of living over time or regions . It is an index that measures differences in the price of goods and services and allows for substitutions with other items as prices vary

Answer 19

Cost of living COL

Question 20

A duty or obligation to pay money, deliver goods , or render services u see an espresso or implied agreement

Answer 20

Debt

Question 21

Business expenses or losses that are legally permitted to be subtracted from the gross revenue from a business when computing its taxable income

Answer 21

Deductions

Question 22

An index of prices used to measure the change in the cost of basic goods and services with a fixed base period

Answer 22

Consumer price index. CPI

Question 23

A process by which decisions are analyzed. The benefits of a given situation or business related action are summed and then the costs associated with taking that a action are subtracted

Answer 23

Cost Benefit Analysis.

Question 24

An estimate of salary or wage expenditures for a set period of time

Answer 24

Compensation budget

Question 25

The art of measuring communicating and interpreting financial activity

Answer 25

Accounting

Question 26

The amounts the practice e owes to suppliers that are payable in the future

Answer 26

Accounts payable

Question 27

Money that is owed to the practice by a client for products or services provided on credit

Answer 27

Accounts receivable AR

Question 28

A system that recognizes revenue as earned and expenses as incurred

Answer 28

Accrual accounting

Question 29

Accounting method that recognizes income when it is earned and expenses when they are incurred regardless of when cash is received or disbursed

Answer 29

Accrual basis

Question 30

Relating to income that remains after the deduction of taxes due

Answer 30

After tax

Question 31

Periodic expense attributed to the decline in usefulness of intangible assets over it’s estimated useful life

Answer 31

Amortization

Question 32

A form of settlement negotiation facilitated by a neutral third party

Answer 32

Arbitration

Question 33

Any asset that lacks physical substance and is usually very hard to valuate

Answer 33

Asset-intangible

Question 34

A trust that can be used to maintain control over the trust assets for a designated period of time which may survive death

Answer 34

Asset control

Question 35

Things of value owned by. Business enterprise such as cash, accounts, receivables and equipment

Answer 35

Assets

Question 36

Any asset that cannot be easily converted to cash

Answer 36

Assets-fixed

Question 37

A record of financial transactions from which an accountant can reconstruct the sequence of events

Answer 37

Audit trails

Question 38

Total revenue of a time period divided by the total number of transactions in that period

Answer 38

Average transaction charge ATC

Question 39

Also referred to as the statement of financial conditions the balance sheet summarizes the assets, liabilities, and owners equity at a particular date

Answer 39

Balance sheet

Question 40

Summary of financial transactions which have occurred over a given period on a bank a account

Answer 40

Bank statement

Question 41

The process by which a business compares itself to others

Answer 41

Benchmarking

Question 42

A financial projection used to estimate and control the results of future business operations

Answer 42

Budget

Question 43

One entity acquiring control of another entity

Answer 43

Capital acquisitions

Question 44

The rights (equity) of the owners business enterprise

Answer 44

Capio

Question 45

A system that recognizes income only when cash is collected form a sale and recognizes expenses when cash is actually paid for goods and services received

Answer 45

Cash accounting

Question 46

Accounting method that measures income when cash is received and expenses when cash is spent

Answer 46

Cash basis

Question 47

Financial report on the source of cash and use of cash

Answer 47

Cash flow statement

Question 48

A systematic listing of all accounts names and numbers used by a company

Answer 48

Chart of accounts

Question 49

An estimate of cAsh receipts and disbursement for a specific period of time. Used to determine whether a business had enough money to maintain standard operations. Also helps determine if cash money is being used in unproductive capacity

Answer 49

Cash budget

Question 50

An analysis that is used to determine when your business will be able to cover all its expenses and begin to make a profit

Answer 50

Break even analysis

Question 51

Measurable quantities for a given period of time that are considered industry standards

Answer 51

Benchmark

Question 52

Current=short term assets such as general inventory, cash, and accounts receivable Fixed =long term assets such as land building and equipment Intangible =not physical in nature such As copyrights and goodwill

Answer 52

Assets ( current,fixed, intangible)

Question 53

Property of any kind held by an assessee Whether connected with their business or profession or not connected with their business or profession. It includes all kinds of property movable or immovable tangible fixed or circulating

Answer 53

Capital asset

Question 54

Any asset reasonably expected to be sold consumed or exhausted through the normal operations of the business within the current fiscal year

Answer 54

Asset-current

Question 55

Expenses which contain both a fixed cost component and variable cost component. The fixed cost element is part of the cost that needs to be paid irrespective of the level of activity achieved by the entity

Answer 55

Semi variable costs

Question 56

The expense of a business not directly associated with the making of a product or providing of a service such as administrative technical or selling expenses

Answer 56

Operating expenses

Question 57

The limit of the amount of money one can deduct from their salary to place in a retirement account

Answer 57

Maximum contribution

Question 58

A bookkeeping term that describes the document in which business transactions are originally recorded as they occur. The book of entry prior to the ledger

Answer 58

Journal

Question 59

Summary of the practices income expenses and resulting profit or loss for a specific period

Answer 59

Profit and loss. P&L

Question 60

The consequences of being involved in something determined by law

Answer 60

Legal implications

Question 61

Practice debts

Answer 61

Liabilities

Question 62

Enhancement paid by a tenant to leased space

Answer 62

Leasehold improvements

Question 63

Expenses that increase or decrease dollar amount in direct relation to the volume of practice activity

Answer 63

Variable costs

Question 64

A section of the practice that can be assessed in terms of its revenue and expenses

Answer 64

Profit centers