WGU D104 INTERMEDIATE ACCOUNTING
II FINAL TEST 2026 QUESTIONS WITH
CORRECT ANSWERS GRADED A+
◍ Journal entry to record sale of gift certificate booklet.
Answer: Debit cash, credit unearned gift card revenue
◍ book value per share.
Answer: common stockholders' equity / outstanding shares
◍ Times interest earned ratio.
Answer: (Net Income + Interest Expense + Income Tax Expense) / Interest
Expense
◍ Asset Turnover Ratio.
Answer: net sales/average total assets
◍ Journal entry to record the issuance of bonds with detachable warrants.
Answer: Debit cash, debit discount on bonds payable, credit bonds payable.
Debit cash, credit paid in capital - stock warrants.
◍ Journal entry to record warranty costs incurred.
Answer: Debit warranty liability, credit cash, inventory, accrued payroll
◍ Journal entry to record bond interest payment mid year with a discount.
Answer: Debit interest expense, credit discount on bonds payable, credit
cash.
◍ Stock may be issued in exchange for cash, property or services. How is it
recorded?.
Answer: Property or service is recorded at the fair or market value of the
stock. If the fair or market value is not available, the fair or market value of
the property or services received is used.
,◍ The group or composite method.
Answer: a depreciation method where a straight-line rate is computed by
dividing the total of the annual depreciation expense for all assets in the
group by the total cost of the assets.
◍ The Composite method.
Answer: the composite life is the total depreciable cost / by total annual
depreciation
◍ Journal entry to record a gain on investment when a company declares a
property dividend.
Answer: Debit investment in stock, credit gain on investment.
◍ Contingencies not accrued.
Answer: Risk of loss or damage of enterprise property by fire, explosion or
other hazards, general or unspecified business risks, or risk of loss from
catastrophes assumed by property and casualty insurance companies
including reinsurance.
◍ Natural resources depletion expense.
Answer: (depletion rate X units of usage) / extracted
◍ Journal entry to record interest expense on a bond at a premium at the end of
the year.
Answer: Debit interest expense, debit premium on bonds payable, credit
interest payable
◍ What is the effect on earnings per share when a company acquires shares of
it's own stock on the open market?.
Answer: Increase
◍ What is the journal entry to record an impairment loss?.
Answer: dr Impairment losscr accumulated depreciation
◍ Stockholders' equity is generally classified into two major categories.
Answer: earned capital and contributed capital.
◍ A small stock dividend will.
, Answer: have no effect on total assets or total stockholders' equity.
◍ Journal entry to record a long term loan with payment due during the current
fiscal year.
Answer: Debit cash, credit current maturities of long term debt, credit note
payable
◍ Journal entry to record payment to sales tax agency if sales tax is not
segregated and there is a gain on sales tax.
Answer: Debit sales revenue, credit gain on sales tax collection, credit cash
◍ How much should be recorded in the mortgages payable account on closing
with 4 points upon closing.
Answer: Points reduce cash received, but do not affect the basis of the
mortgage liability.
◍ Unearned compensation is reported.
Answer: in stockholders' equity in the balance sheet as a contra equity
account.
◍ ASSET TURNOVER RATE.
Answer: net sales/average total assets
◍ Journal entry to record a sale when sales tax is not segregated.
Answer: Debit cash, credit sales revenue
◍ warrants.
Answer: certificates entitling the holder to acquire shares of commons stock
at a certain price within a stated period of time.
◍ When recognizing compensation expense under a stock option plan,
unanticipated forfeitures are treated as.
Answer: a change in accounting principle.
◍ Journal entry to record ore extracted.
Answer: Debit inventory (ore), credit mineral mine
◍ In testing for recoverability of property, plant, and equipment, an
impairment loss is required if the:.
II FINAL TEST 2026 QUESTIONS WITH
CORRECT ANSWERS GRADED A+
◍ Journal entry to record sale of gift certificate booklet.
Answer: Debit cash, credit unearned gift card revenue
◍ book value per share.
Answer: common stockholders' equity / outstanding shares
◍ Times interest earned ratio.
Answer: (Net Income + Interest Expense + Income Tax Expense) / Interest
Expense
◍ Asset Turnover Ratio.
Answer: net sales/average total assets
◍ Journal entry to record the issuance of bonds with detachable warrants.
Answer: Debit cash, debit discount on bonds payable, credit bonds payable.
Debit cash, credit paid in capital - stock warrants.
◍ Journal entry to record warranty costs incurred.
Answer: Debit warranty liability, credit cash, inventory, accrued payroll
◍ Journal entry to record bond interest payment mid year with a discount.
Answer: Debit interest expense, credit discount on bonds payable, credit
cash.
◍ Stock may be issued in exchange for cash, property or services. How is it
recorded?.
Answer: Property or service is recorded at the fair or market value of the
stock. If the fair or market value is not available, the fair or market value of
the property or services received is used.
,◍ The group or composite method.
Answer: a depreciation method where a straight-line rate is computed by
dividing the total of the annual depreciation expense for all assets in the
group by the total cost of the assets.
◍ The Composite method.
Answer: the composite life is the total depreciable cost / by total annual
depreciation
◍ Journal entry to record a gain on investment when a company declares a
property dividend.
Answer: Debit investment in stock, credit gain on investment.
◍ Contingencies not accrued.
Answer: Risk of loss or damage of enterprise property by fire, explosion or
other hazards, general or unspecified business risks, or risk of loss from
catastrophes assumed by property and casualty insurance companies
including reinsurance.
◍ Natural resources depletion expense.
Answer: (depletion rate X units of usage) / extracted
◍ Journal entry to record interest expense on a bond at a premium at the end of
the year.
Answer: Debit interest expense, debit premium on bonds payable, credit
interest payable
◍ What is the effect on earnings per share when a company acquires shares of
it's own stock on the open market?.
Answer: Increase
◍ What is the journal entry to record an impairment loss?.
Answer: dr Impairment losscr accumulated depreciation
◍ Stockholders' equity is generally classified into two major categories.
Answer: earned capital and contributed capital.
◍ A small stock dividend will.
, Answer: have no effect on total assets or total stockholders' equity.
◍ Journal entry to record a long term loan with payment due during the current
fiscal year.
Answer: Debit cash, credit current maturities of long term debt, credit note
payable
◍ Journal entry to record payment to sales tax agency if sales tax is not
segregated and there is a gain on sales tax.
Answer: Debit sales revenue, credit gain on sales tax collection, credit cash
◍ How much should be recorded in the mortgages payable account on closing
with 4 points upon closing.
Answer: Points reduce cash received, but do not affect the basis of the
mortgage liability.
◍ Unearned compensation is reported.
Answer: in stockholders' equity in the balance sheet as a contra equity
account.
◍ ASSET TURNOVER RATE.
Answer: net sales/average total assets
◍ Journal entry to record a sale when sales tax is not segregated.
Answer: Debit cash, credit sales revenue
◍ warrants.
Answer: certificates entitling the holder to acquire shares of commons stock
at a certain price within a stated period of time.
◍ When recognizing compensation expense under a stock option plan,
unanticipated forfeitures are treated as.
Answer: a change in accounting principle.
◍ Journal entry to record ore extracted.
Answer: Debit inventory (ore), credit mineral mine
◍ In testing for recoverability of property, plant, and equipment, an
impairment loss is required if the:.
