Financial Terms Quiz

What is the balance sheet equation?

• Assets = Liabilities + Equity

• Assets + Liabilities = Equity

• Equity = Assets - Liabilities

• Liabilities = Assets + Equity

What is liquidity?

• The principle of how quickly an asset can be converted into cash

• The total amount of cash a company has

• The value of all assets owned by a company

• The amount of debt a company has

What does GAAP stand for?

• Generally Accepted Accounting Principles

• General Accounting and Auditing Procedures

• Government Accounting and Auditing Practices

• General Accepted Accounting Policies

What are capital gains?

• The increase in value of an asset above what you paid for it

• The total income generated from an investment

• The amount of money paid in taxes on an asset

• The total expenses incurred in selling an asset

What is equity?

• The amount of money someone has in a stock or asset after subtracting debts

• The total value of all assets owned by a company

• The amount of cash a company has on hand

• The total liabilities of a company

What is Earnings Per Share (EPS)?

• The net income minus dividends divided by the number of shares

• The total revenue of a company divided by the number of shares

• The total profit of a company divided by its expenses

• The total assets of a company divided by its liabilities

What is net worth?

• The value of everything you own minus what you owe

• The total income of a company over a period

• The total expenses of a company over a period

• The total assets of a company

What is amortization?

• The process of accounting for an asset that is intangible or non-physical

• The total depreciation of a physical asset over time

• The total value of a company's assets

• The total liabilities of a company

What are capital markets?

• Markets where buyers and sellers trade financial assets like stocks or bonds

• Markets where only government bonds are traded

• Markets that deal exclusively with real estate

• Markets that only trade commodities

What does EBITDA stand for?

• Earnings Before Interest, Taxes, Depreciation, and Amortization

• Earnings Before Income, Taxes, Depreciation, and Amortization

• Earnings Before Interest, Taxes, Dividends, and Amortization

• Earnings Before Interest, Taxes, Dividends, and Assets