Financial Accounting D102 WGU Exam Study
Questions with Correct Answers 2026
Account -Correct Answer ✔-An accounting record in which the results of
transactions are accumulated; shows increases, decreases, and a balance
Accounts Receivable -Correct Answer ✔-A current asset representing money due
for services performed or merchandise sold on credit
On August 1 of Year 1, a company paid $7,200 for two years' rent. The rental
period starts on August 1 of Year 1.
Which debit or credit is correctly included in the adjusting journal entry necessary
on December 31 of Year 1? -Correct Answer ✔-1. Credit to rent expense for
$1,500.
2. Credit to prepaid rent for $5,100.
3. Debit to rent expense for $1,500.
4. Debit to rent expense for $5,100.
Correct: 3
On October 1 of Year 1, a company made a $60,000 cash loan to another
company. The interest rate on the loan is 5%. No cash payments will be collected
on the loan until September 30 of Year 2.
Which debit or credit is correctly included in the adjusting journal entry necessary
on the company's books (the lender) on December 31 with respect to this loan? -
Correct Answer ✔-1. Credit to interest revenue for $750.
2. Debit to interest revenue for $2,250.
3. Credit to interest revenue for $2,250.
4. Debit to interest revenue for $750.
Correct: 2
,On January 1, a company had office supplies costing $4,600. During the year, the
company bought (and recorded) additional office supplies costing $9,900. On
December 31, a physical count of office supplies revealed that supplies costing
$2,900 remained.
Which debit or credit is correctly included in the adjusting journal entry necessary
on December 31 to record the supplies that the company used during the year? -
Correct Answer ✔-1. Credit to office supplies expense for $11,600.
2. Debit to office supplies for $11,600.
3. Credit to office supplies for $11,600.
4. Debit to cash for $11,600.
Correct: 3
At the end of the year, before any closing entries are made, which account has a
debit balance? -Correct Answer ✔-Cost of goods sold
Revenues: Credit or Debit on the book? -Correct Answer ✔-Credits; they represent
increases of equity
Expenses and Dividends: Credit or Debit on the books? -Correct Answer ✔-Debits;
they represent decreases in equity
Steps to closing Entries: -Correct Answer ✔-1. Separate Nominal accounts from
real accounts
2. Debit or credit each nominal account to make the balance = 0
3. Corresponding debit or credit to Retained Earnings
How is the ending retained earnings calculated? -Correct Answer ✔-Beginning
retained earnings + Net Income - Dividends
Net Income -Correct Answer ✔-the difference between total revenue and total
expenses
, On January 6, a credit sale was made for $1,000. Terms for the sale were 4/10,
n/30. Cash for the sale was collected on January 25.
Which debit or credit should be included in the journal entry to record the cash
collection on January 25? -Correct Answer ✔-1. Debit accounts receivable for
$1,000
2. Debit sales discounts for $960
3. Debit cash for $1,000
4. Debit sales discounts for $40
Correct: 2
A company's controller estimated bad debt expense using the percentage of
accounts receivable method. Total sales for the year were $1,500,000. The ending
balance in accounts receivable was $300,000. An examination of the outstanding
accounts at the end of the year indicates that approximately 7% of these accounts
will ultimately prove to be uncollectible. Before any adjustment, the balance in
the allowance for bad debts is $4,000 (credit). Total accounts written off as
uncollectible during the year were $15,000.
Which debit or credit is included in the adjusting entry to record bad debt expense
for the year? -Correct Answer ✔-1. Credit allowance for bad debts for $21,000
2. Debit allowance for bad debts for $25,000
3. Debit allowance for bad debts for $15,000
4. Credit allowance for bad debts for $17,000
Correct: 3
The following are payroll data for the employees of a company:
Salaries Withholding Taxes Payable$20,000
Salaries Payable400,000Federal Withholding Taxes Payable48,000
FICA Taxes Payable, Employees26,000
What is needed in the journal entry to record the given employee payroll data? -
Correct Answer ✔-1. Credit to state withholding taxes payable $48,000
2. Debit to salaries payable for $400,000
Questions with Correct Answers 2026
Account -Correct Answer ✔-An accounting record in which the results of
transactions are accumulated; shows increases, decreases, and a balance
Accounts Receivable -Correct Answer ✔-A current asset representing money due
for services performed or merchandise sold on credit
On August 1 of Year 1, a company paid $7,200 for two years' rent. The rental
period starts on August 1 of Year 1.
Which debit or credit is correctly included in the adjusting journal entry necessary
on December 31 of Year 1? -Correct Answer ✔-1. Credit to rent expense for
$1,500.
2. Credit to prepaid rent for $5,100.
3. Debit to rent expense for $1,500.
4. Debit to rent expense for $5,100.
Correct: 3
On October 1 of Year 1, a company made a $60,000 cash loan to another
company. The interest rate on the loan is 5%. No cash payments will be collected
on the loan until September 30 of Year 2.
Which debit or credit is correctly included in the adjusting journal entry necessary
on the company's books (the lender) on December 31 with respect to this loan? -
Correct Answer ✔-1. Credit to interest revenue for $750.
2. Debit to interest revenue for $2,250.
3. Credit to interest revenue for $2,250.
4. Debit to interest revenue for $750.
Correct: 2
,On January 1, a company had office supplies costing $4,600. During the year, the
company bought (and recorded) additional office supplies costing $9,900. On
December 31, a physical count of office supplies revealed that supplies costing
$2,900 remained.
Which debit or credit is correctly included in the adjusting journal entry necessary
on December 31 to record the supplies that the company used during the year? -
Correct Answer ✔-1. Credit to office supplies expense for $11,600.
2. Debit to office supplies for $11,600.
3. Credit to office supplies for $11,600.
4. Debit to cash for $11,600.
Correct: 3
At the end of the year, before any closing entries are made, which account has a
debit balance? -Correct Answer ✔-Cost of goods sold
Revenues: Credit or Debit on the book? -Correct Answer ✔-Credits; they represent
increases of equity
Expenses and Dividends: Credit or Debit on the books? -Correct Answer ✔-Debits;
they represent decreases in equity
Steps to closing Entries: -Correct Answer ✔-1. Separate Nominal accounts from
real accounts
2. Debit or credit each nominal account to make the balance = 0
3. Corresponding debit or credit to Retained Earnings
How is the ending retained earnings calculated? -Correct Answer ✔-Beginning
retained earnings + Net Income - Dividends
Net Income -Correct Answer ✔-the difference between total revenue and total
expenses
, On January 6, a credit sale was made for $1,000. Terms for the sale were 4/10,
n/30. Cash for the sale was collected on January 25.
Which debit or credit should be included in the journal entry to record the cash
collection on January 25? -Correct Answer ✔-1. Debit accounts receivable for
$1,000
2. Debit sales discounts for $960
3. Debit cash for $1,000
4. Debit sales discounts for $40
Correct: 2
A company's controller estimated bad debt expense using the percentage of
accounts receivable method. Total sales for the year were $1,500,000. The ending
balance in accounts receivable was $300,000. An examination of the outstanding
accounts at the end of the year indicates that approximately 7% of these accounts
will ultimately prove to be uncollectible. Before any adjustment, the balance in
the allowance for bad debts is $4,000 (credit). Total accounts written off as
uncollectible during the year were $15,000.
Which debit or credit is included in the adjusting entry to record bad debt expense
for the year? -Correct Answer ✔-1. Credit allowance for bad debts for $21,000
2. Debit allowance for bad debts for $25,000
3. Debit allowance for bad debts for $15,000
4. Credit allowance for bad debts for $17,000
Correct: 3
The following are payroll data for the employees of a company:
Salaries Withholding Taxes Payable$20,000
Salaries Payable400,000Federal Withholding Taxes Payable48,000
FICA Taxes Payable, Employees26,000
What is needed in the journal entry to record the given employee payroll data? -
Correct Answer ✔-1. Credit to state withholding taxes payable $48,000
2. Debit to salaries payable for $400,000
