WSP ACCOUNTING PRACTICE TEST FOR EXAMS
|QUESTIONS WITH ANSWERS VERIFIED 100%
CORRECT|
Net Revenue - ✔✔Total dollar payment for goods and services that are credited to an
income statement over a particular time period.
Cost of Goods Sold - ✔✔Cost of Goods sold represents a company's direct cost of
manufacture (for manufacturers) or procurement (for merchandisers) of a good or
service that the company sells to generate revenue.
Gross Profit - ✔✔Revenues - cost of goods sold
Selling, General & Administrative (SG&A) - ✔✔Operating costs not directly associated
with the production or procurement of the product or service that the company sells to
generate revenue. Payroll, wages, commissions, meal and travel expenses, stationary,
advertising, and marketing expenses fall under this line item.
Research & Development (R&D) - ✔✔A company's activities that are directed at
developing new products or procedures
EBITDA - ✔✔Earnings before interest, taxes, depreciation & amortization : Gross
Profit - SG&A - R&D. EBITDA is a popular measure of a company's financial performance
Depreciation & Amortization (D&A) - ✔✔The allocation of cost over a fixed asset's
useful life in order to match the timing of the cost of the asset with when it is expected
to generate revenue benefits
, Other Operating Expenses / Income - ✔✔Any operating expenses not allocated to
COGS, SG&A, R&D, D&A
Operating profit (EBIT) - ✔✔Earnings before interest & taxes: EBITDA - D&A
Interest Expense - ✔✔Interest expense is the amount the company has to pay on
debt owed. This could be to bondholders or to banks. Interest expense subtracted from
EBIT equals earnings before taxes (EBT).
Interest Income - ✔✔A company's income from its cash holdings and investments
(stocks, bonds, and savings accounts).
Non-operating items - ✔✔Items peripheral to core operations. Includes gains/losses
on investments and revaluation of certain financial assets and debt obligations.
Income Tax Expense - ✔✔The tax liability a company reports on the income
statement.
Net Income - ✔✔EBIT - Net Interest Expense - Other Nonoperating Income - Taxes
Basic earnings per share (EPS) - ✔✔Net income / Basic Weighted Average Shares
Outstanding
Diluted EPS - ✔✔Net income / Diluted Weighted Average Shares Outstanding
Cash (A) - ✔✔Money held by the company in its bank accounts
|QUESTIONS WITH ANSWERS VERIFIED 100%
CORRECT|
Net Revenue - ✔✔Total dollar payment for goods and services that are credited to an
income statement over a particular time period.
Cost of Goods Sold - ✔✔Cost of Goods sold represents a company's direct cost of
manufacture (for manufacturers) or procurement (for merchandisers) of a good or
service that the company sells to generate revenue.
Gross Profit - ✔✔Revenues - cost of goods sold
Selling, General & Administrative (SG&A) - ✔✔Operating costs not directly associated
with the production or procurement of the product or service that the company sells to
generate revenue. Payroll, wages, commissions, meal and travel expenses, stationary,
advertising, and marketing expenses fall under this line item.
Research & Development (R&D) - ✔✔A company's activities that are directed at
developing new products or procedures
EBITDA - ✔✔Earnings before interest, taxes, depreciation & amortization : Gross
Profit - SG&A - R&D. EBITDA is a popular measure of a company's financial performance
Depreciation & Amortization (D&A) - ✔✔The allocation of cost over a fixed asset's
useful life in order to match the timing of the cost of the asset with when it is expected
to generate revenue benefits
, Other Operating Expenses / Income - ✔✔Any operating expenses not allocated to
COGS, SG&A, R&D, D&A
Operating profit (EBIT) - ✔✔Earnings before interest & taxes: EBITDA - D&A
Interest Expense - ✔✔Interest expense is the amount the company has to pay on
debt owed. This could be to bondholders or to banks. Interest expense subtracted from
EBIT equals earnings before taxes (EBT).
Interest Income - ✔✔A company's income from its cash holdings and investments
(stocks, bonds, and savings accounts).
Non-operating items - ✔✔Items peripheral to core operations. Includes gains/losses
on investments and revaluation of certain financial assets and debt obligations.
Income Tax Expense - ✔✔The tax liability a company reports on the income
statement.
Net Income - ✔✔EBIT - Net Interest Expense - Other Nonoperating Income - Taxes
Basic earnings per share (EPS) - ✔✔Net income / Basic Weighted Average Shares
Outstanding
Diluted EPS - ✔✔Net income / Diluted Weighted Average Shares Outstanding
Cash (A) - ✔✔Money held by the company in its bank accounts
