WGU D104 Pre-Assessment Intermediate Accounting
II Units 4-6 (KWV1) 2026-2027 Actual Exam with
Real 50 Questions and Verified Correct Answers
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A company had both outstanding convertible bonds and stock warrants during the current year.
The company determined that if the bonds had been converted during the year, calculated basic
earnings per share (EPS) would have decreased, and if the warrants had been exercised during
the year, calculated basic EPS would have increased. How should the company consider these
securities when calculating and presenting diluted earnings per share on the income statement? -
CORRECT ANSWER: The company should include the effect of the bonds, but exclude the
effect of the warrants.
A company has 10,000 shares of $6 par value common stock outstanding. The market value of
the stock is $10. What is the impact of a 2-for-1 stock split? - CORRECT ANSWER: Par value
of the stock is is reduced to $3 per share.
$6/2 = $3
A company has a $1,000 bond that is convertible into 100 shares of common stock (par value
$10). How will this conversion impact earnings per share if the company chooses to convert the
debt? - CORRECT ANSWER: Decreases immediately
A company has acquired 15,000 shares of its treasury stock at $10 per share using the cost
method. The company now decides to sell 2,000 of its treasury stock for $12 per share. The
journal entry to record the sale of treasury stock includes a debit to Cash for $24,000. What is the
correct credit entry? - CORRECT ANSWER: Treasury Stock for $20,000 and Paid-in Capital
Treasury Stock for $4,000
A company invested $15,000,000 in a coal mine estimated to have 1,500,000 tons of coal. In the
first year, the company extracted 100,000 tons of coal. At the end of the first year, it became
, clear that the coal mine was likely to have only another 700,000 tons of coal remaining. Which
depletion rate will be used starting in the second year? - CORRECT ANSWER: $20.00 per ton
$15,000,000/700,000
A company invests $15,000,000 into a coal mine estimated to have 20 million tons of coal. The
coal mine is estimated to be in operation for the next five years. In Year 1, the company extracted
and sold 1 million tons of coal. How much is depletion in Year 1? - CORRECT ANSWER:
$750,000
$15,000,000/20,000,000= $.75
$.75*1,000,000=$750,000
A company issued a 30-year mortgage note with a face value of $425,000 to purchase a new
production plant. The lender assessed 3 points to close the financing. Which amount should be
recorded on the balance sheet for the Mortgage Note Payable? - CORRECT ANSWER:
$425,000
A company issues $10,000,000 in 20-year bonds at a 9% interest rate, paid annually. On the issue
date, the bonds sold for $9,875,000. At which value were the bonds issued? - CORRECT
ANSWER: Discount
A company issues bonds at par with a 10-year term for $1,000,000 on January 1 of Year 1. The
bonds bear interest at an annual rate of 7% payable semiannually on January 1 and July 1. Which
journal entry should be recorded on July 1 of Year 1? - CORRECT ANSWER: Debit Interest
Expense for $35,000; Credit Cash for $35,000
A company issues bonds with a face value of $1,000,000 with a 10-year term at 95 on January 1
of Year 1. The bonds bear interest at an annual rate of 5% payable semiannually on January 1 and
July 1. Which journal entry should be recorded on January 1 of Year 1? - CORRECT ANSWER:
II Units 4-6 (KWV1) 2026-2027 Actual Exam with
Real 50 Questions and Verified Correct Answers
Already Graded A+ Guaranteed Success Brand New
Version!!
A company had both outstanding convertible bonds and stock warrants during the current year.
The company determined that if the bonds had been converted during the year, calculated basic
earnings per share (EPS) would have decreased, and if the warrants had been exercised during
the year, calculated basic EPS would have increased. How should the company consider these
securities when calculating and presenting diluted earnings per share on the income statement? -
CORRECT ANSWER: The company should include the effect of the bonds, but exclude the
effect of the warrants.
A company has 10,000 shares of $6 par value common stock outstanding. The market value of
the stock is $10. What is the impact of a 2-for-1 stock split? - CORRECT ANSWER: Par value
of the stock is is reduced to $3 per share.
$6/2 = $3
A company has a $1,000 bond that is convertible into 100 shares of common stock (par value
$10). How will this conversion impact earnings per share if the company chooses to convert the
debt? - CORRECT ANSWER: Decreases immediately
A company has acquired 15,000 shares of its treasury stock at $10 per share using the cost
method. The company now decides to sell 2,000 of its treasury stock for $12 per share. The
journal entry to record the sale of treasury stock includes a debit to Cash for $24,000. What is the
correct credit entry? - CORRECT ANSWER: Treasury Stock for $20,000 and Paid-in Capital
Treasury Stock for $4,000
A company invested $15,000,000 in a coal mine estimated to have 1,500,000 tons of coal. In the
first year, the company extracted 100,000 tons of coal. At the end of the first year, it became
, clear that the coal mine was likely to have only another 700,000 tons of coal remaining. Which
depletion rate will be used starting in the second year? - CORRECT ANSWER: $20.00 per ton
$15,000,000/700,000
A company invests $15,000,000 into a coal mine estimated to have 20 million tons of coal. The
coal mine is estimated to be in operation for the next five years. In Year 1, the company extracted
and sold 1 million tons of coal. How much is depletion in Year 1? - CORRECT ANSWER:
$750,000
$15,000,000/20,000,000= $.75
$.75*1,000,000=$750,000
A company issued a 30-year mortgage note with a face value of $425,000 to purchase a new
production plant. The lender assessed 3 points to close the financing. Which amount should be
recorded on the balance sheet for the Mortgage Note Payable? - CORRECT ANSWER:
$425,000
A company issues $10,000,000 in 20-year bonds at a 9% interest rate, paid annually. On the issue
date, the bonds sold for $9,875,000. At which value were the bonds issued? - CORRECT
ANSWER: Discount
A company issues bonds at par with a 10-year term for $1,000,000 on January 1 of Year 1. The
bonds bear interest at an annual rate of 7% payable semiannually on January 1 and July 1. Which
journal entry should be recorded on July 1 of Year 1? - CORRECT ANSWER: Debit Interest
Expense for $35,000; Credit Cash for $35,000
A company issues bonds with a face value of $1,000,000 with a 10-year term at 95 on January 1
of Year 1. The bonds bear interest at an annual rate of 5% payable semiannually on January 1 and
July 1. Which journal entry should be recorded on January 1 of Year 1? - CORRECT ANSWER:
