WGU D774 - Section 1 EXAM
QUESTIONS AND VERIFIED
CORRECT ANSWERS
GRADED A+ [LATEST 2026-
2027] 100% GUARANTEED
PASS
What is the primary purpose of accounting? - CORRECT ANSWER-To provide financial
information useful in decision-making.
Who are the internal users of accounting information? - CORRECT ANSWER-Managers,
executives, supervisors, and employees.
Who are the external users of accounting information? - CORRECT ANSWER-Investors, creditors,
government agencies, suppliers, and customers.
What is the accounting equation? - CORRECT ANSWER-Assets = Liabilities + Owner's Equity
What type of business is owned by one person and offers no liability protection? - CORRECT
ANSWER-Sole proprietorship.
, What is the key characteristic of a corporation? - CORRECT ANSWER-It is a separate legal entity
with limited liability for its owners.
What are the four main financial statements? - CORRECT ANSWER-Income Statement,
Statement of Retained Earnings, Balance Sheet, Statement of Cash Flows.
Which financial statement shows revenues and expenses? - CORRECT ANSWER-Income
Statement.
Which financial statement shows the company's financial position at a specific point in time? -
CORRECT ANSWER-Balance Sheet.
What is GAAP? - CORRECT ANSWER-Generally Accepted Accounting Principles — the U.S.
standards for financial reporting.
Who develops U.S. accounting standards? - CORRECT ANSWER-FASB (Financial Accounting
Standards Board).
What is the matching principle? - CORRECT ANSWER-Expenses should be recorded in the same
period as the revenues they help generate.
What's the main difference between GAAP and IFRS? - CORRECT ANSWER-GAAP is rules-based;
IFRS is principles-based.
What is an asset? - CORRECT ANSWER-A resource owned by a business (e.g., cash, equipment,
inventory).
What is a liability? - CORRECT ANSWER-A debt or obligation owed by the business to outsiders.
QUESTIONS AND VERIFIED
CORRECT ANSWERS
GRADED A+ [LATEST 2026-
2027] 100% GUARANTEED
PASS
What is the primary purpose of accounting? - CORRECT ANSWER-To provide financial
information useful in decision-making.
Who are the internal users of accounting information? - CORRECT ANSWER-Managers,
executives, supervisors, and employees.
Who are the external users of accounting information? - CORRECT ANSWER-Investors, creditors,
government agencies, suppliers, and customers.
What is the accounting equation? - CORRECT ANSWER-Assets = Liabilities + Owner's Equity
What type of business is owned by one person and offers no liability protection? - CORRECT
ANSWER-Sole proprietorship.
, What is the key characteristic of a corporation? - CORRECT ANSWER-It is a separate legal entity
with limited liability for its owners.
What are the four main financial statements? - CORRECT ANSWER-Income Statement,
Statement of Retained Earnings, Balance Sheet, Statement of Cash Flows.
Which financial statement shows revenues and expenses? - CORRECT ANSWER-Income
Statement.
Which financial statement shows the company's financial position at a specific point in time? -
CORRECT ANSWER-Balance Sheet.
What is GAAP? - CORRECT ANSWER-Generally Accepted Accounting Principles — the U.S.
standards for financial reporting.
Who develops U.S. accounting standards? - CORRECT ANSWER-FASB (Financial Accounting
Standards Board).
What is the matching principle? - CORRECT ANSWER-Expenses should be recorded in the same
period as the revenues they help generate.
What's the main difference between GAAP and IFRS? - CORRECT ANSWER-GAAP is rules-based;
IFRS is principles-based.
What is an asset? - CORRECT ANSWER-A resource owned by a business (e.g., cash, equipment,
inventory).
What is a liability? - CORRECT ANSWER-A debt or obligation owed by the business to outsiders.
