PRAXIS II BUSINESS EDUCATION 2
(ACCOUNTING) EXAM | PRACTICE
QUESTIONS AND DETAILED ANSWERS|
GRADED A+ | GUARANTEED SUCCESS
Updated 2026 Questions and Answers | 100% Verified
Exam Prep
, Debtor The party or organization that borrows the money.
Finance ..., the management of money and credit and banking and investments
appreciation an increase in price or value
depreciation a decrease in price or value
liquidity being in cash or easily convertible to cash
Start-up expenses Expenses incurred to decide whether to go into business and which business to enter can
be expensed
up to $5,000; the balance is amortized over a period of 180 months. If the start-up
expenses exceed $50,000, the immediate deduction is reduced dollar for dollar, until no
deduction after $55,000.
Income statement a financial statement that gives operating results for a specific period
Profit & Loss statement An itemized financial statement of the income and expenses of a company's operations.
Cash flow statement A measure of the money you receive and the money you spent
Fiscal policy created and implemented by the federal government in the hopes of increasing the gross
national product, raising employment and stabilizing price and money.
Expansionary fiscal policy combats a recession by either lowering taxes or increasing government spending
Contractionary fiscal policy aims to fight inflation and involves raising taxes and decreasing spending.
Monetary policy actions of a bank or currency regulation organization that affects the size of the money
supply and therefore interest rates. Designed to restrain inflation, improve the
employment rate and stabilize the economy.
3 ways the Fed carries out monetary policy Open market operations, discount rate, reserve requirements. To halt a recession -
expands the money supply, decrease inflation - limit spending by contracting the money
supply.
(ACCOUNTING) EXAM | PRACTICE
QUESTIONS AND DETAILED ANSWERS|
GRADED A+ | GUARANTEED SUCCESS
Updated 2026 Questions and Answers | 100% Verified
Exam Prep
, Debtor The party or organization that borrows the money.
Finance ..., the management of money and credit and banking and investments
appreciation an increase in price or value
depreciation a decrease in price or value
liquidity being in cash or easily convertible to cash
Start-up expenses Expenses incurred to decide whether to go into business and which business to enter can
be expensed
up to $5,000; the balance is amortized over a period of 180 months. If the start-up
expenses exceed $50,000, the immediate deduction is reduced dollar for dollar, until no
deduction after $55,000.
Income statement a financial statement that gives operating results for a specific period
Profit & Loss statement An itemized financial statement of the income and expenses of a company's operations.
Cash flow statement A measure of the money you receive and the money you spent
Fiscal policy created and implemented by the federal government in the hopes of increasing the gross
national product, raising employment and stabilizing price and money.
Expansionary fiscal policy combats a recession by either lowering taxes or increasing government spending
Contractionary fiscal policy aims to fight inflation and involves raising taxes and decreasing spending.
Monetary policy actions of a bank or currency regulation organization that affects the size of the money
supply and therefore interest rates. Designed to restrain inflation, improve the
employment rate and stabilize the economy.
3 ways the Fed carries out monetary policy Open market operations, discount rate, reserve requirements. To halt a recession -
expands the money supply, decrease inflation - limit spending by contracting the money
supply.
